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Thursday, February 2, 2023

Shares of the Brazilian store Americanas plummeted 82% in 4 days: why

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The day after the announcement, Americana’s shares on the Brazilian stock exchange Bovespa fell 77.3% and, although it recovered 15% on Friday, the following Monday it again recorded a fall of 38.4%. A) Yes, in the last 4 days, the company’s shares have plummeted 82%. This Tuesday they opened the day with a rise of up to 6%.

The signature apparently did not record debt on their balance sheets with financial institutions contracted to pay purchases to suppliersaccording to accounting expert Silas Degrafprofessor at the Santa Cruz de Curitiba University (south), on his YouTube channel.

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“Everything indicates that we are facing a very well-crafted case of lack of transparency for the benefit of the company and its shareholders,” he told AFP. Marcello Marin, Finance Director of Spot Finanças, specializing in accounting and financial management.

“I don’t think it was a robbery, but a fraud to reduce company debt and consequently increase its value, with which the shareholders and the company earn more and more in the financial market,” he added.

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Anand Kishore, Daycoval Asset’s investment fund manager, assured that the situation “does not have a cash effect for American stores, but it should have an accounting effect on the balance sheet” of the company.

The scandal led to the resignation on Wednesday of the company’s president, Sergio Riahim, and of André Covredirector of Investor Relations, who had assumed their positions on January 2.

Rial said that he was stepping aside because the company’s numbers prevented him from executing his capitalization plans to settle the firm gross debtwhich calculated between 30,000 and 35,000 million reais (between 5,800 and 6,800 million dollars at the current exchange rate).

Rial will continue to advise some shareholders, including Brazilian billionaires Jorge Paulo Lemann, Marcel Telles and Beto Sicupira, owners of about 30% of the company through the investment company 3G Capital.

All three are in the Top-5 of the richest Brazilians of 2022, according to Forbes magazine: Lemann is the first, with a net worth of about $14 billion; Telles is the third, with US$9.300 million; and Sicupira is fourth, with US$7.7 billion.

“It will surely impact them, but they will not stop being the richest in Brazil,” says Marin.

The scandal in Americanas led to the Securities and Exchange Commission (CVM)which regulates the capital market, to open three administrative processes on Thursday “to clarify the facts” and warned of sanctions to “possibly responsible”.

On behalf of the minority shareholders, the Brazilian Association of Investors (Abradin) prepares a legal complaintbecause it considers that the investors were “deceived”.

“This situation affects the entire national economy, because it undermines the credibility of the Brazilian capital market,” he said. Aurelio Valportopresident of Abradin, in statements collected this Monday by the newspaper O Globo.

The Board of Directors of the company, on your side, created an independent committee “to ascertain the circumstances that caused such accounting inconsistencies.”

Founded in 1929 in the city of Niterói, in the state of Rio de Janeiro (southeast), and in the digital market since 1999, Americanas is listed on the Sao Paulo stock exchange.

“The Sao Paulo Stock Exchange was no longer in such good shape to go through that impact without suffering. I was already falling due to instabilities, mainly due to the entry of a new government (that of the leftist Luiz Inácio Lula da Silva) with new plans that are very different from the previous one (that of the far-right Jair Bolsonaro),” Marin explained.

Source: Ambito

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