Rio Grande do Sul state unveils water utility privatization plan

Brazil's Rio Grande do Sul state unveiled a privatization plan for its water utility Corsan to bolster the company's cash position and accelerate investments in sanitation projects. 

The state plans to sell a controlling stake in the company through an IPO in October with the aim of raising 1bn reais (US$180mn), state governor Eduardo Leite (pictured) said in a press release.

The government will seek support from state lawmakers to move the privatization process quickly through the legislative process, said Leite, who added that the government would continue to be an important shareholder in Corsan and have a say in the company's strategy.

The privatization plan is part of a major transformation of Brazil’s sanitation sector. 

Last year congress approved a key change in regulation, paving the way for more investments by private companies in a sector largely dominated by state-owned companies. 

“The new Corsan that will be born from this process will be a company with greater financial capacity to attract 10bn reais in investments, which will multiply works by the state in the coming years, directly generating thousands of jobs and unlocking the construction potential of many regions,” said Leite. “These works will certainly boost civil construction and generate thousands of other jobs indirectly."