Tuesday, Mar 27, 2012


   (From THE WALL STREET JOURNAL) 
   By Luciana Magalhaes and Matthew Cowley

Abu Dhabi's sovereign-wealth fund said it would invest $2 billion to buy into the sprawling business empire of Brazil's richest man, Eike Batista, a move that could lead to further investments by the Gulf state in Brazil and Latin America.

The transaction "marks our first significant direct investment into one of the fastest-growing markets and is an important step in [the] development of strategic opportunities in Brazil and Latin America," said Khaldoon Khalifa Al Mubarak, chief executive of Mubadala Development Corporation, the Abu Dhabi government's sovereign-wealth fund, in a statement.

Mr. Batista, in a telephone interview, said he expects to secure another $1 billion investment for EBX within six months. Other sovereign-wealth funds and investors from Brazil, the U.S. or Asia could invest in a future round of funding, he said.

Mr. Batista said that he has no immediate uses for the cash but that it would accelerate some of the group's plans.

Mubadala, established in 2002 to help diversify the oil-dependent state's economy, manages a $46 billion portfolio of investments and partnerships.

The fund will buy a 5.63% equity interest in U.S.-based Centennial Asset Brazilian Equity Fund LLC, or CABEF, the holding company for Mr. Batista's interests that is commonly referred to as the EBX Group.

It's the first time that Mr. Batista has brought a significant partner into CABEF, the nerve center of his bustling business empire, which has interests in a range of industries from mining and oil to infrastructure and logistics. EBX Group is in the process of raising billions of dollars to develop those businesses, which are at different stages of development, so returns may yet be some years off.

Mubadala also provides more global heft for the EBX Group. In January, Germany's E.ON AG agreed to buy a 10% stake in MPX Energia SA, the group's electric power company, in a deal that will have the companies invest billions of dollars in new South American power plants.

"The [EBX] group has been taking international partners for its companies and now has found a partner for the holding company," said Pedro Galdi, an investment analyst at Sao Paulo brokerage SLW.

(END) Dow Jones Newswires

27-03-12 0411GMT