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Valuable Asset Of Former Billionaire Eike Batista Was Sold By Brokerage From British Virgin Islands; Large Brazilian Bank Has Its Name Linked To The Operation
Argenta Securities, a brokerage based in the British Virgin Islands, has acquired the last valuable asset of former billionaire Eike Batista. A source from Veja magazine says that the brokerage already has a buyer to transfer the asset and claims that the buyer is XP Investimentos, a consortium led by a large Brazilian bank.
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The highly valuable asset of Eike Batista is a debenture issued by the mining company Anglo American as part of the sale operation of the Minas-Rio complex by MMX to the multinational in 2008.
The asset, which has an estimated value of around US$ 200 million, was mapped by the Brazilian Association of Investors (Abradin) and acquired for R$ 612 million by Argenta.
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Amount Will Be Used To Cover The Debts Of MMX, Eike’s Mining Company That Went Bankrupt
According to Veja, the brokerage has until the end of the first half of this month to make the payment. The money will be used to cover the debts of MMX, Eike’s mining company that was declared bankrupt last year.
Argenta is represented in Brazil by Jorge Lima Coelho, the son of the late businessman Jair Coelho, who became known in Rio de Janeiro as the “King of Takeaway Meals.” Fábio Galvão, a former CVM director, is one of the lawyers representing the brokerage in the country.
Argenta explained its reasons for acquiring the asset to Veja: “An opportunity was seen in the acquisition of the debentures seized by the 1st Business Court of BH due to the specifics of this debenture, as there is strong consolidation in the sector as recently announced by Vale,” it claims.
“There is interest in royalty funds, as the ore from Minas-Rio has elevated assessment, super premium, in addition to consistent operational results.” The brokerage ends the note stating that the “acquisition is syndicated, involving a large American hedge fund and two financial institutions in Brazil.”
Eike Closes Partnership With China And Gains ‘Infinite’ Capital To Implement Oil And Gas, Mining, Renewable Energy, And Infrastructure Projects In Brazil
After watching his empire fall apart, former billionaire Eike Batista has been spending his time nurturing a list of at least 11 projects that he calls ‘unicorns,’ which include a gas pipeline connecting Brazil to Paraguay, new gold mines, renewable energy, and nanotechnology. This was reported exclusively by Brazil Journal.
Despite facing imprisonment, fines, and lawsuits, Eike has not given up on his projects and continued to engage his brilliant mind 24 hours a day to bring these new businesses to fruition, hindered only by capital limitations, as his image and credibility as an entrepreneur are not among the most coveted by national and international investors.
Enter China Development Integration Limited (CDIL), an investment vehicle linked to the Chinese government and based in Hong Kong, a heavyweight investor that shares its appetite for grand projects and is willing to support Eike.
For those unfamiliar, CDIL has been an active participant in the Belt and Road Initiative, the project through which China has increased its geopolitical power by investing in the infrastructure of dozens of countries worldwide since 2013.
The main driver behind the marriage between the Chinese and Eike was Rubicon Capital Partners, a newly formed management firm by Pedro Pinto Guimarães, a Rio de Janeiro executive who spent more than five years at PetroRio and left the oil company a year ago. While at PetroRio, Guimarães met Chinese and Saudi investors who were analyzing co-investments with the company.
Eike Will Have Apparently Infinite Capital To Implement His Projects In Brazil
The new business between the Chinese and the former billionaire will be as follows: Eike brings his pipeline of projects (including assets and optioned assets), and CDIL provides the apparently infinite capital, in addition to bringing with it several Chinese banks and state-owned enterprises that will be responsible for providing machinery, equipment, and services, and, when it comes to agricultural or metal commodities, will guarantee the purchase of production in the form of offtake agreements.
Eike “is one of the greatest natural resource developers in history,” said CDIL Chairman Andy Lai to Brazil Journal during a Zoom video call from Hong Kong. “He developed one of the largest mines in the world [the Minas-Rio project, which now belongs to Anglo American], knows the data about large unexplored reserves, and established the largest infrastructure projects in Brazil. For us, leveraging his knowledge and experience is a wise move.”
According to Brazil Journal, the Chinese requested the interview as a way to introduce themselves to Brazilian society and market agents. According to Lai, the Chinese and Eike have another thing in common: a mindset that thinks about projects with horizons of 30 to 50 years.
“The Chinese saw Açu, OGX, and MMX and said, ‘Eike thinks a lot like us, but all that he has done is something for governments to do, it’s government scale,’ said Pedro Guimarães from Rubicon. According to him, Eike will contribute with his “structuring mind,” and CDIL will help with management capacity.
Partnership Between China And Eike Will Reach Billions Of Reais, From Mining To Infrastructure In Brazil
For the Chinese CDIL, its joint investments with Eike will reach billions of reais, from mining to infrastructure. The group hired Lefosse to represent it in Brazil.
To execute the projects, the partners established a holding company in Hong Kong: CDIL will have a majority stake, but “more or less 50/50,” said Edmond Amir, a French executive specialized in financial modeling of large projects who heads the international area of CDIL. As part of the agreement, the Chinese will cover the R$ 800 million fine that Eike will have to pay as part of his agreement with the Attorney General’s Office.
The mining company MMX is the first test of the new partnership, and it announced last week that CDIL is negotiating with creditors for the company’s debts and intends to take it out of bankruptcy protection.
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