At 81, Abilio Diniz is practically a legend in Brazil. Billionaire. Business guru. Author of two best-selling autobiographies. He’s even got more than 1 million Facebook followers.
Yet Diniz is now close to getting ousted as chairman of Brazil poultry giant BRF SA, an embarrassing spectacle for a man once hailed for his management acumen. He was named chairman five years ago, pledging to make the $7.4 billion food giant leaner and more profitable. But after a series of questionable moves and invigorated competition, BRF is today losing money, and investors are seeking to fire him and the rest of the board.
BRF’s turmoil is the latest in a series of corporate crises erupting in Latin America’s largest economy, from powerhouses Petrobras SA to JBS SA, that have made investors increasingly sensitive to corporate governance issues. Under Diniz, BRF replaced its entire management twice.
“Diniz just put in a bunch of financial yuppies to run the company,” Joao Lian, a vice president at Brazil minority shareholders group Aidmin and a BRF shareholder, said in a phone interview.
The tycoon’s fate is likely to be discussed at a board meeting Monday, but major shareholders are already lining up potential director replacements. He owns less than 4 percent of BRF and has lost support among investors, including Aberdeen Asset Management. Even long-time ally Tarpon Investimentos SA, the company’s third-largest holder, is participating in talks for the formation of a new board that does not include Diniz, a person with direct knowledge of the matter said, asking not to be identified discussing private information.
Diniz didn’t respond to a request for comment.