RIO DE JANEIRO, Feb 3 (Reuters) - Brazilian billionaire Lirio Parisotto is seeking support from minority shareholders to become chairman of steelmaker Usiminas and resolve a battle between rival controlling factions, a source with direct knowledge of the situation said.
Parisotto, who runs the Geração L.Par fund which owns an unspecified small stake in the company, needs support from a group of voting shareholders with a combined 5 percent stake to trigger a vote for a new board.
One of Brazil’s largest private investors and a previous Usiminas board member, Parisotto is confident he can trigger the vote before the end of February and be elected chairman, the source said, seeking anonymity due to the sensitivity of the issue.
He is seeking a consensus among all minority shareholders to put himself forward for the position.
Usinas Siderurgicas de Minas Gerais, as Usiminas is formally known, is in the midst of a shareholder battle between two steel giants that control the company - Japan’s Nippon Steel & Sumitomo Metal Corp and Ternium, which is part of Italo-Argentine conglomerate Techint Group.
The two groups remain at odds over the departure of former Chief Executive Julian Eguren, who had previously worked at Ternium. Eguren was pushed out for “inappropriate receipts of money” after the board’s chairman Paulo Penido, a Nippon representative, cast the deciding vote.
Ternium want Eguren reinstated while Nippon refused.
“Lirio (Parisotto) is not inclined towards Ternium or Nippon; he is acting in the correct way that a minority shareholder should in a crisis like this one,” the source said.
“If you imagine Nippon was a woman who caught Ternium, a man, with another woman, there would be no solution for this marriage... it is necessary to see an outcome by which Nippon goes one way and Ternium the other.”
The source added that Parisotto had stopped trying to increase his stake directly since the price of common shares, which carry voting rights, has soared. Common shares have increased 187 percent since December as investors buy to gain greater voting control or to position themselves for a potential buyout.
Editing by Cynthia Osterman