NYSE listing confirms world class status

INTERNATIONAL interest in Petrobras has increased enormously since its listing on the New York Stock Exchange two years ago. The listing confirmed the company’s world-class status and exposed it to a much wider range of investors.
Some180 million shares were sold to local investors and on the NYSE in 2000. The government’s stake in the oil company is now 55.7 percent.
Since then, there has been a sweeping reorganization to improve the company’s competitiveness and Petrobras’ new status has also provided it with greater flexibility in financing.

LUCIANA BASTOS DE FREITAS RACHID Executive Manager of Investor Relations at Petrobras

Luciana Bastos de Freitas Rachid, Executive Manager of Investor Relations at Petrobras, says there has been a tremendous increase in the demand for information about the company and its activities.
“Not only Brazilian, but American shareholders have been interested in following the performance of the company,” she says. “We have a group of people dedicated to providing information to individual shareholders, and another group dedicated to institutional investors.”
Petrobras offers tremendous potential, not only in upstream activities but also in its operations abroad, making it an attractive prospect for investors.

“We have all the fundamentals,” says Ms. Rachid, “production growth, a clear financial position and, despite the high cost of capital, as a Brazilian company we compete fairly well with any other major oil company in the world.”
Along with other Brazilian blue chip companies like CVRD and Embraer, Petrobras is committed to an investor relations program to keep it highly visible within the international markets. Good governance practices and transparency are at the core of the company’s philosophy, in line with recent legislation and codes of practice.

“The scrutiny that we come under is even greater than before,” says Ms. Rachid. “We are working at a very high level of transparency.
“The fact that we are operating in an emerging market implies that our disclosure must be better than the disclosure of most American companies. We are very happy to have this kind of disclosure, as investors now realize that risk is everywhere, even in the United States."

Petrobras has no fears that a change in government will adversely affect the company, which is, as Ms. Rachid points out, the biggest taxpayer in Brazil.
“Four of our nine board members represent minority shareholders. They cannot be changed without a publicly announced General Shareholders’ Meeting, which would discourage excessive political interference, if it were ever sought.
“We do not believe that it is in the interest of any Brazilian government to reduce Petrobras’ strength,” she adds.