Ownership and Control Structure of Brazilian Companies
35 Pages Posted: 14 Apr 2000
Date Written: Undated
The paper analyzes the structure of ownership and control of public Brazilian companies using data from 325 companies listed at the Sao Paulo Stock Exchange. We show a high degree of ownership concentration. The biggest shareholder has, on average, 41% of the equity capital, while the five biggest have 61%. The concentration occurs mainly with voting shares with 62% of the companies having one shareholder with more than 50% of the voting shares. Actually, the violation of the one share-one vote rule with the use of non-voting shares is very common. Only 11% of the companies does not have non voting shares and the companies have, on average, only 54% of their equity capital as voting capital. We also analyze the indirect ownership structure. Pyramiding structure is not commonly used as a way of violating the one share - one vote rule, besides the fact that the control is maintained through more than one tier. We also show the importance of different shareholder classes. Corporations are the main investor category in the direct ownership structure while individuals are more important at the when indirect control is accounted for.
JEL Classification: G32, G34
Suggested Citation: Suggested Citation