CADE clears acquisition of COPASA by Grupo Equatorial

On 5 August, the Administrative Council for Economic Defense (CADE) cleared without restrictions the acquisition of 30% of the share capital of the Companhia de Saneamento de Minas Gerais (COPASA) by Gerais Saneamento S.A., a company owned by the Grupo Equatorial, as part of COPASA’s privatisation plan.

Following an appeal filled by the trade union of workers in the water purification, distribution and sewerage services industries of the Brazilian state of Minas Gerais (SINDÁGUA-MG), the Tribunal of CADE examined the potential competitive impacts of the transaction, as well as the arguments presented by the interested third party.

Commissioner José Levi, rapporteur of the case, detailed SINDÁGUA-MG’s appeal, which stated that the acquisition should be examined in view of other recent mergers in the sanitation sector.

According to the trade union, Equatorial’s stake in sanitation companies in the Brazilian states of São Paulo and Minas Gerais (SABESP and CORSAN) could reduce competition in future procurements, compromise yardstick regulation, and increase conglomerate effects and risks relating to data governance.

In light of these allegations, SINDÁGUA-MG requested the conversion of the summary proceeding into an ordinary proceeding, further investigations, as well as the imposition of antitrust remedies.

The rapporteur’s vote reaffirms CADE’s established view that the sanitation market should be analysed from two perspectives: competition within the market, at the municipal level, and competition for market share, at the national level. The analysis concluded that there is no horizontal overlap between the activities of COPASA and CSA Equatorial at the municipal level, as the concessionaires operate in different geographical areas. However, at the national level, Mr Levi acknowledged the existence of horizontal overlap relating to competition for future concessions, auctions, and privatisation processes, without identifying any vertical integration between the applicants’ activities.

By analysing the corporate relations, the commissioner examined Equatorial’s 15% stake in SABESP, which was cleared by CADE in 2024 as a non-controlling interest, and the alleged links among the companies Equatorial, Perfin, and the sanitation company of the Brazilian state of Rio Grande do Sul (CORSAN). Although Rapporteur Levi considered SABESP's shareholding for competitive reasons, he concluded that the company is not formally part of the Grupo Equatorial and that the coexistence of minority shareholdings does not constitute joint control, unified management, or coordination between the companies, since there are no agreements or governance mechanisms that could influence the behaviour of the parties involved.

Thus, there were no anticompetitive effects regarding the transaction. According to him, there is no evidence of significant reduction of competition in procurements, harm to yardstick regulation, anticompetitive effects arising from portfolio power, or the use of data to create or reinforce market power. In addition, he also stated that the examples mentioned by the trade union concerned different circumstances and did not demonstrate that such effects occurred in the case at hand.

Therefore, the Tribunal of CADE dismissed the appeal and cleared the transaction without restrictions.

Access Case No. 08700.005684/2026-06