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MARKET ANNOUNCEMENT

CENTRAIS ELÉTRICAS BRASILEIRAS S/A

CNPJ: 00.001.180/0001-26 | NIRE: 533.0000085-9

PUBLIC COMPANY

 

 

Centrais Elétricas Brasileiras S/A (“Company” or “Eletrobras”) (B3: ELET3, ELET5 & ELET6; NYSE: EBR & EBR.B; LATIBEX: XELT.O & XELT.B) hereby informs its shareholders and the market in general that received, on this date, from B3 – Brasil, Bolsa, Balcão, the Official Letter 742/2019-SLS, below transcript, requesting clarification of a report published by Agência Estado – Broadcast, on 12/10/2019, under the title “Eletrobras/Ferreira: Government may have 45% in capitalization’, according to which, among other information, that the trend is that the shares that will be with the government are worth twice the present value in a possible new share offering

 

Free translation of the Official Letter 1,099/2019-SLS:

 

December 10, 2019

1,099/2019-SLS

 

Centrais Elétricas Brasileiras S.A. - Eletrobras

At. Ms. Elvira Baracuhy Cavalcanti Presta

CFO and IRO

Ref.: Request for news press release

Dear Sirs

In a report published by Agência Estado – Broadcast, on 12/10/2019, under the title “Eletrobras/Ferreira: Government may have 45% in capitalization, it is stated, among other information, that the trend is that the shares that will be with the government are worth twice the present value in a possible new share offering

We ask for clarification on the item indicated, until 9 am of 12/11/2019, with its confirmation or not, as well as other information considered important.”

 

In consideration of the above-mentioned Official Letter, we clarify that:

 

1.        The news deals with the potential amount of Eletrobras’ capital increase, with the consequent dilution of the shareholding of the Federal Government, as controlling shareholder of Eletrobras, in the privatization process of Eletrobras;

 

2.        In an event held on this date at the Rio de Janeiro Commercial Assembly, Eletrobras CEO Wilson Ferreira Junior explained, when asked about the potential amount of capital increase, that the amount depends on the assessment to be made by the National Council of Energy Policy (“CNPE”), about the grant to be paid for the decotization of the plants extend by Law 12,783/2013, which has not yet occurred;

 

3.        The evaluation by CNPE shall only take place after approval of Bill No. 5,877/2019, sent to the Chamber of Deputies, which discusses the proposal for privatization of Eletrobras, according to the Relevant Fact of November 5, 2019;

 

 

This document may contain estimates and projections that are not statements of fact that occurred in the past but reflect our management beliefs and expectations and may constitute forward-looking statements and estimates under Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended. The words "believe", "may", "may", "estimate", "continue", "anticipate", "intend", "expect" and the like are intended to identify estimates that necessarily involve risks and uncertainties, known or unknown . Known risks and uncertainties include, but are not limited to: general economic, regulatory, political and commercial conditions in Brazil and abroad, changes in interest rates, inflation and value of the Real, changes in volumes and the pattern of electric energy use by consumer, competitive conditions, our level of indebtedness, the possibility of receiving payments related to our receivables, changes in rainfall and water levels in the reservoirs used to operate our hydroelectric power plants, our financing and capital investment plans, existing and future government regulations , and other risks described in our annual report and other documents filed with CVM and SEC. Estimates and projections refer only to the date they were expressed and we assume no obligation to update any of these estimates or projections due to the occurrence of new information or future events. Future results of the Company's operations and initiatives may differ from current expectations and the investor should not rely solely on the information contained herein. This material contains calculations that may not reflect accurate results due to rounding.

 

4.        In the answer cited above, the Eletrobras CEO rightly pointed out that the numbers so far are merely illustrative and exemplary and that they should not be considered precisely because the assessment of the CNPE did not occur and is therefore speculative;

 

5.        Therefore, the Company does not confirm the volume of capital increase and percentage of dilution of the Federal Government, mentioned in the report published by Agência Estado – Broadcast, since the matter disregarded the important caveat made by the CEO of the Company to be dealing with numbers hypothetical and exemplary;

 

6.        In light of the foregoing, there is no relevant information that has not been adequately disclosed by the Company through Relevant Facts.

 

 

 

Rio de Janeiro, December 10, 2019

 

 

Elvira Cavalcanti Presta

CFO and Investor Relations Officer

 

 

 

This document may contain estimates and projections that are not statements of fact that occurred in the past but reflect our management beliefs and expectations and may constitute forward-looking statements and estimates under Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended. The words "believe", "may", "may", "estimate", "continue", "anticipate", "intend", "expect" and the like are intended to identify estimates that necessarily involve risks and uncertainties, known or unknown . Known risks and uncertainties include, but are not limited to: general economic, regulatory, political and commercial conditions in Brazil and abroad, changes in interest rates, inflation and value of the Real, changes in volumes and the pattern of electric energy use by consumer, competitive conditions, our level of indebtedness, the possibility of receiving payments related to our receivables, changes in rainfall and water levels in the reservoirs used to operate our hydroelectric power plants, our financing and capital investment plans, existing and future government regulations , and other risks described in our annual report and other documents filed with CVM and SEC. Estimates and projections refer only to the date they were expressed and we assume no obligation to update any of these estimates or projections due to the occurrence of new information or future events. Future results of the Company's operations and initiatives may differ from current expectations and the investor should not rely solely on the information contained herein. This material contains calculations that may not reflect accurate results due to rounding.

 

 

 

CENTRAIS ELÉTRICAS BRASILEIRAS S.A. - ELETROBRÁS
By:	/S/ Elvira Baracuhy Cavalcanti Presta
	Elvira Baracuhy Cavalcanti Presta CFO and Investor Relations Officer