By Brazil Stock Guide – Companhia de Saneamento de Minas Gerais (B3: CSMG3) said that its Chairman Hamilton Amadeo resigned effective immediately. The decision followed a UOL investigation published hours earlier detailing plea agreements that cite at least R$ 63 million (about $12 million) in illicit payments between 2010 and 2018 tied to Aegea Saneamento, where Amadeo previously served as chief executive. The timing intensifies scrutiny over governance at the Minas Gerais state-controlled water utility, which sits at the center of Governor Romeu Zema’s privatization plan.
The report draws on collaboration agreements homologated in 2025 by Brazil’s Superior Court of Justice. According to testimonies, Aegea executives authorized payments to politicians and public officials in at least six states and 20 municipalities to obtain or maintain water and sewage concessions. The alleged scheme used cash deliveries, inflated service contracts, real estate purchases and intermediary law firms. In one account, cash was handed over in installments inside the company’s São Paulo headquarters. In another, invoices simulated consulting services to generate off-book resources.
Aegea signed a leniency agreement with federal prosecutors in April 2021 and committed to pay R$ 439 million (around $88 million) to the federal government over 15 annual installments indexed to Brazil’s consumer price index. The deal followed internal investigations that predated 2018 and were voluntarily shared with authorities. Days after the agreement, Itaúsa acquired a minority stake in Aegea for R$ 1.3 billion, bolstering the group’s capital ahead of major sanitation auctions under Brazil’s new regulatory framework.
The case spans high-profile concessions. Testimonies cite alleged payments in Santa Catarina involving municipal authorities and state audit court members. In Mato Grosso do Sul, statements describe campaign-related transfers totaling up to R$ 30 million through fictitious rental contracts. In Rio de Janeiro, the accounts mention payments linked to the Prolagos concession in the Lagos region. Politicians named in the testimonies have denied wrongdoing, according to the report.
Copasa’s filing to the market did not reference the allegations. The statement simply confirmed that the company had received Amadeo’s resignation request as a board member, effective immediately. No successor was announced.
Governance Under Pressure
The resignation places Copasa’s privatization roadmap under sharper focus. Governor Romeu Zema has argued that selling control of the utility would reduce Minas Gerais’ fiscal deficit and unlock investment in water and sewage infrastructure. Investors monitor governance standards as a core valuation driver, especially in regulated utilities with long-term concession contracts.
Brazil’s sanitation sector has expanded rapidly since Congress approved the New Sanitation Framework in 2020. The law set targets to provide potable water and sewage collection to 90% of municipalities by 2033. The shift triggered multi-billion-real auctions and drew private operators into territories once dominated by state companies. Aegea became one of the largest winners in that cycle, including major concessions in Rio de Janeiro.
For Copasa, the near-term impact hinges on market confidence. A swift board transition may limit volatility. Yet prolonged legal or political spillovers could weigh on the timing and structure of any share sale. For global investors, the episode underscores a broader pattern in Brazil’s infrastructure story: aggressive expansion often collided with compliance failures, and capital markets now demand cleaner governance before pricing the next growth phase.
Aegea process
In a filing, Aegea Saneamento said a 2021 agreement with Brazil’s Federal Prosecution Service definitively settled integrity issues related to conduct prior to 2018. The company said it revamped governance and internal controls and renewed its management at the time. The R$ 439 million settlement, payable over 15 annual inflation-adjusted installments, has Montese as principal debtor. Aegea added the deal does not affect concessions, debt terms or new public contracts, and its financial impact was already booked in 2021
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