Bloomberg News

Billionaire Batista Talking With Wealth Funds on Gold Stake

February 28, 2012

(Updates with Batista comment in fourth paragraph.)

Feb. 15 (Bloomberg) -- Brazilian billionaire Eike Batista, whose investments range from iron ore to coal, said he’s in talks with sovereign wealth funds and other potential “strategic partners” to sell a stake in his AUX gold unit.

Batista’s EBX Group Co. holding company is also still weighing a listing of AUX, which last year paid C$1.08 billion ($1.08 billion) to acquire Ventana Gold Corp., Batista told reporters in Sao Paulo. He didn’t give further details.

Colombia’s gold deposits have attracted investment from Batista and AngloGold Ashanti Ltd, the third largest producer of the metal, after record prices and improved security following a government crackdown on drug-funded rebels. Gold has climbed for eleven consecutive years, reaching an all-time high of $1,923.70 on Sept. 6 as investors look for bullion to protect their wealth against economic uncertainty and financial turmoil.

“Sovereign wealth funds are interested in investing in real assets” such us gold, Batista, 55, told reporters today before a conference organized by Banco BTG Pactual SA.

Batista said last year he would list AUX in Bogota, London and Sao Paulo as soon as May 2012. AUX is worth $5 billion, he said in October, and has 7.2 million ounces of gold reserves after the acquisition of Vancouver-based Ventana in March 2011. AUX’s La Bodega mine, located 400 kilometers (248 miles) northeast of Bogota, also has copper and silver deposits.

Gold Production

AUX expects to start gold production in between two-and-a- half and three years, Batista said Oct. 6.

A feasibility study for Batista’s CCX coal unit, which also has assets in Colombia, will be ready by mid-April, Batista said today, adding that the company doesn’t need to be listed as it already has enough cash. Batista said last month he would hold an IPO for CCX.

EBX is also studying “business opportunities” in the coffee industry, the company said Jan. 31. In December, EBX entered the catering services market through NRX-Newrest, a joint venture with Newrest Group Holding. EBX also last year started IMX, a partnership with IMG Worldwide Inc. focused on sports and arena management in Brazil.

Batista’s joint venture with Foxconn Technology Group, a maker of metal casings for Apple Inc., will invest $2.5 billion in a plant to make electronic screens in the South American country, he also said today. The billionaire is expanding into new segments after becoming Brazil’s richest person by selling shares in commodities and logistic startups including OGX Petroleo e Gas Participacoes SA, the country’s second-biggest oil company by market value, and MMX Mineracao & Metalicos SA, an iron-ore producer.

--With assistance from Rodrigo Orihuela in Rio de Janeiro. Editor: Dale Crofts, Charles Siler

To contact the reporters on this story: Francisco Marcelino in Sao Paulo at mdeoliveira@bloomberg.net; Juan Pablo Spinetto in Rio de Janeiro at jspinetto@bloomberg.net

To contact the editor responsible for this story: Dale Crofts at dcrofts@bloomberg.ne


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