(Adds share price)
SAO PAULO, June 5 (Reuters) - Shares in Brazilian state-run power company Centrais Eletricas Brasileiras SA dropped almost 5 percent on Tuesday after a court ordered the company to suspend its ongoing privatization process.
In a securities filing, Eletrobras, as the company is commonly known, said a regional labor court in Rio de Janeiro also ordered the company to present a study within 90 days examining the impact of the privatization process on workers. The company “will analyze the appropriate measures and keep the market informed,” Eletrobras said.
Eletrobras is in the process of privatizing itself, which would include the sale of six distribution subsidiaries, but the effort has hit significant roadblocks in recent months and is now widely seen as unlikely to move forward this year.
The government of President Michel Temer announced plans to sell a controlling stake in the company last August.
Organizing the privatization has proved extremely complex, however, and in late May, the head of Brazil’s lower house said the chamber would not vote on a presidential decree outlining privatization rules and asked Temer to send a draft bill instead.
That makes the legislative process much more complicated, and Congress likely will not have enough time to approve a privatization framework before the October general election.
Shares in Eletrobras had fallen 4.7 percent to 18.02 reais in early morning trade on Tuesday. Brazil’s benchmark Bovespa index was off 0.3 percent. (Reporting by Gram Slattery Editing by Nick Zieminski)