Troubled Brazilian construction giant Odebrecht pulled out as the majority partner in the Southern Peruvian Gas Pipeline amid a major corruption probe that has brought down its former chief executive.
Odebrecht Latinvest, a unit of the Brazilian firm, said that it decided to withdraw from its majority role in order to “protect the [Southern Peruvian Gas Pipeline] from any reputational impact,” daily Gestion reported.
It said that its partners in the project, Enagas and Peru’s Grana y Monero, would take over the management of the project. David San Frutos, the representative for Enagas, was appointed the general manager of the project, while an executive from Grana y Montero, Dennis Gray, was named the manager of financial structure and investments.
The decision comes only days after a Brazilian judge sentenced Odebrecht’s former CEO, Marcelo Odebrecht, to over 19 years in prison for corruption in a bribery scandal that has rocked some of Brazil’s biggest companies.
It has also hit the country’s most powerful politicians, including former president Luiz Inacio Lula da Silva, who was detained this week in the corruption probe.
Prosecutors, lawmakers and non-government organizations in Peru are investigating whether Brazilian construction firms here bribed local officials to win public works contracts. Odebrecht and other Brazilian companies won billions of dollars in contracts during the last three administrations.
