It is a State Company in which the State reduces its participation in the voting capital, from a majority control (at least 50% plus one share), giving up control to other shareholders, forming a Corporation with shared voting power. With adequate dispersion control of voting capital the State will still be a powerful shareholder, influencing strategic decisions, profitably, and armored against political-partisan interests which are a source of inefficiency and corruption.
Since the beginning of the privatization process in Brazil, this idea has been put aside with the argument that auctioning voting control to a single group of investors would lead to reaching higher valuations and maximum revenues to the government.
There were many privatizations in Brazil although facing a significant transaction cost in Congress and the Judiciary as wells as people’s protests on the streets against change from one government monopoly to another, now private.
A minority but significant government participation in the voting capital is compatible with the public interest, profitability, and low bureaucracy. Workers’ participation in the capital, with representation in the board of directors, would enhance political support. This configuration would protect the company from direct public interference in prices and the firm’s administration. Professional administration and free human capital management and investment are essential for a newly privatized company.
Well-conducted, privatization processes can also serve as a reinforcement for the development of domestic capital markets, establishing a virtual circle that can benefit society as a whole.
The State Private Company (SPC) would be also adequate even for developed countries stagnated by low productivity, lack of investment and unreasoned public deficits. It could lead to a new emancipation era for traditional utility companies, dominated by ideological and politic-partisan interests, constantly draining noble public resources for obscure and unproductive private interests.