São Paulo – Brazilian group EBX and Mubadala, the investment company of Abu Dhabi, in the United Arab Emirates, announced on Tuesday (26) that the Arab company is going to invest US$ 2 billion in the holding company of businessman Eike Batista, in exchange for 5.63% in the group’s capital. In a press statement, EBX says that the partnership between both companies is “strategic”, that the funds will be used to “strengthen the already solid structure of the group’s capital” and will support the development of new business.
With the investment, Mubadala will have an indirect share in the group’s other listed companies, including OGX, OSX, MMX, LLX and MPX, and in the unlisted ones, like AUX, REX and IMX. With the agreement, Mubadala will become a partner in Batista’s group’s enterprises in the cement, entertainment, technology and fertilizer business, among others.
In the press statement, both groups stated that this is the “first significant direct investment by Mubadala in Brazil”. Batista stated that the agreement strengthens EBX group’s capacity to implement new projects. “Mubadala, after careful ‘due diligence’ (analysis of balance sheets) of our companies, recognises the great potential of our Latin-American assets. We are very proud of our new partner and believe that this operation strengthens relations not just between both groups, but also between both countries (Brazil and the Emirates)”, says the businessman, in the press statement.
The CEO of Mubadala, Khaldoon Khalifa Al Mubarak, says that relations with “global class partners is a key element” in the fund’s investment strategy. “It is an important step in the development of strategic opportunities for Mubadala in Brazil and Latin America. We are confident that this partnership should open route for greater collaboration in future,” says the press statement.
EBX group includes companies in the energy, logistics, oil, mining and naval industry sectors, and forecasts investment of US$ 15.5 billion by the end of the year in projects like the construction of Açu port, in Rio de Janeiro, thermal electric mills in Maranhão and Ceará and increase the MMX capacity for ore extraction in Minas Gerais and Mato Grosso do Sul. The group’s main shareholder, Eike Batista, is the richest man in Brazil and the 7th richest in the world, according to North American magazine Forbes, which owns assets estimated at US$ 30 billion.
Mubadala was established in 2002 to help Abu Dhabi diversify its investments. In September 2011, the company’s assets totalled US$ 46.2 billion, distributed in the aerospace, energy, finance, infrastructure, real estate and industrial sectors, among others. In April 2011, the chief operating officer at Mubadala, Waleed Al Muhairi, visited Brazil and met with the minister of Development, Industry and Foreign Trade, Fernando Pimentel. At the occasion, he stated that the fund had US$ 13 billion to invest in Brazil, in the sectors of oil, aluminium, semiconductors, infrastructure and aerospace.
This is not EBX group’s first agreement with an Arab company. Last year, the company announced the construction of a fertilizer factory in the state of Rio de Janeiro, in partnership with Egyptian Orascom.
*Translated by Mark Ament
