In the dispute over Folha de S.Paulo, brothers are at war over money and accusations of illegal operation.

247 - The corporate dispute between the shareholders of the Folha de S.Paulo newspaper has taken a new turn with more serious accusations between the Frias siblings. Former editor-in-chief Maria Cristina Frias accuses her younger brother, Luis Frias, of receiving an illegal transfer of UOL shares using privileged information. The transaction allegedly took place on the eve of the IPO of PagSeguro, a payment processing company controlled by the group, according to reports. Valor Econômico. 

The lawsuit was received by the court on March 31st. In it, the journalist requests compensation from "Folha de S.Paulo," which she claims was harmed by Frias's actions. 

According to the accusation, the transfer of shares was made at the end of 2017, shortly before PagSeguro's billion-dollar initial public offering (IPO), held at the end of January 2018. In this operation, Luis Frias received 1.538.462 UOL shares – equivalent to 1,29% of the company's capital. The shares were delivered to him by FolhaPar, the holding company that controls UOL (which, in turn, controls PagSeguro). 

The reason for this transfer was the repayment of a loan, signed in 2011 - at the time, UOL was delisting from the São Paulo Stock Exchange and, to complete the share buyback, Frias claims to have lent FolhaPar R$ 30 million from his own pocket. 

According to the terms of the signed loan, the debt could be repaid in cash or through the delivery of 1.538.462 UOL shares - the document does not mention the market value of these shares, only specifying the volume of shares. 

The transfer made in 2017, therefore, would simply be the settlement of that past debt, Luis Frias argued. 

In the lawsuit, however, Maria Cristina questions the price of the securities considered in the transaction, "far below the real value." Furthermore, she states that the decision to pay off the loan in 2017, six years later, "could not have been more convenient for her," considering the proximity of the IPO. 

The journalist further alleges that, at that time, FolhaPar's management possessed "privileged information related to the conditions of PagSeguro's IPO, which it improperly used," she says. In other words, she points out that her brother authorized the transfer of shares at a low price, knowing that they would be worth much more. 

This would have harmed the other shareholders of FolhaPar, especially Empresa Folha da Manhã (which publishes the “Folha de S.Paulo”).