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Court revokes injunction on Banrisul share sale

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Court revokes injunction on Banrisul share sale

Brazilian state-owned lender Banco do Estado do Rio Grande do Sul SA said a court revoked an injunction that had been preventing a follow-on offering of the bank's shares.

In July, Judge Vanderlei Deolindo ruled to suspend the public offering following a lawsuit filed by former Banrisul President Mateus Bandeira. The judge requested more information from the state of Rio Grande do Sul, the bank's controlling shareholder, on the possible offering, including a study on the viability of the business and fairness of the amounts quoted.

In a statement, Bandeira said he filed the lawsuit to prevent shares of Banrisul from being sold at "a price far below its true economic value," which would cause "irreparable damage" to the state of Rio Grande do Sul. Bandeira lost an election to be state governor to Eduardo Leite last year.

In revoking the previous injunction, Deolindo said the measure "does not characterize a threat of irreparable damage" given that the state government publicized its intention to carry out an offer, Zero Hora reported.

Banrisul's offer is expected to raise up to 2.5 billion reais, the publication said. The bank first considered the measure in 2017 but postponed it due to market instability.

Banrisul previously said it will discontinue its guidance disclosures due to the possible offering.

As of Aug. 29, US$1 was equivalent to 4.15 Brazilian reais.