Brazil's largest pension fund Previ decided to sell its stake in power company CPFL Energia SA to China's utility State Grid Corp, according to a CPFL securities filing on Friday.

State Grid had announced in July an agreement to buy a controlling stake at CPFL from Brazilian engineering conglomerate Camargo Correa. The deal was approved by Brazilian antitrust body Cade on Thursday, opening the way for other shareholders to exercise their right to also sell their stakes in the company.

Previ, the pension fund of state-controlled bank Banco do Brasil SA, told Reuters last week that it was willing to exercise the right to sell its shares to State Grid.

The fund also said its board approved a plan to sell shares not included in the shareholders' agreement in addition to its 19.28 percent stake at the controlling bloc.

With that, Previ's total holdings at CPFL are close to 29 percent, a stake it estimates worth around 7.5 billion reais ($2.31 billion).

State Grid had agreed to pay roughly 6 billion reais for the 23 percent controlling stake sold by Camargo Correa.

If all remaining shareholders decide to exercise the right to sell their holdings to State Grid, the deal's total value could surpass 25 billion reais.

Bonaire Participações, another large holder of CPFL shares, said this week it would inform State Grid next Tuesday about its decision to sell or hold its 15 percent stake.