Billionaire Eike Batista, Brazil’s richest man, is selling a 49 percent stake in his AUX gold business to the Qatar Investment Authority for about $2 billion, according to a person with knowledge of the transaction.
EBX Group Co., Batista’s Rio de Janeiro-based holding company, decided to sell a stake in AUX after shelving plans to take the company public. AUX mines for gold in Colombia. Batista told reporters yesterday in Rio that he had sold an AUX stake without disclosing the buyer or the price.
An EBX official in Rio declined to comment. A call to a Dubai-based official of the Qatar Investment Authority outside of business hours wasn’t answered, while a representative for the fund in London declined to comment.
“Sovereign wealth funds are interested in investing in real assets” such as gold, the 55-year-old mining and energy magnate, whose investments range from iron ore to coal, told reporters on Feb. 15. AUX paid C$1.08 billion ($1.05 billion) last year to buy Ventana Gold Corp.
AUX is worth $5 billion, Batista 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.
Batista’s net worth has climbed 8.7 percent this year, or $2 billion, to $24.5 billion, making him the 13th richest person in the world, according to the Bloomberg Billionaires Index, a daily ranking of the planet’s wealthiest individuals. He has vowed to overtake Carlos Slim, the richest man with a net worth of $68.3 billion, by 2015.
OGX Petroleo e Gas Participacoes SA, Batista’s oil company, dropped 32 percent in Sao Paulo trading this year. The Bovespa benchmark index fell 2.2 percent.
Gold may rise as much as 15 percent to $1,800 an ounce by the fourth quarter, according to the median of 24 analysts forecasts compiled by Bloomberg. The price of the precious metal has risen every year since 2001. Investors turn to gold as a protection of wealth in times of economic uncertainty.
State-owned funds in Asia have been boosting investments in commodities and energy assets after bets on financial stocks went sour following the collapse of Lehman Brothers Holdings Inc. in 2008 that triggered the global financial crisis.
China Investment Corp., the nation’s $400 billion sovereign wealth fund, made a $1.5 billion investment in Canadian mining company Teck Resources Ltd. in July 2009 and $1.58 billion in U.S. power company AES Corp. in November 2009, according to the fund’s website. CIC was set up in 2007 with $200 billion from China’s Ministry of Finance.
In August 2011, GDF Suez SA, Europe’s largest utility by market value, agreed to sell a 30 percent stake in its exploration and production unit to CIC for $3.2 billion.
The value of investments in resources firms at Temasek Holdings Pte, Singapore’s state-owned investment company, rose to S$11.2 billion ($8.8 billion), or 6 percent of its total portfolio, from S$6.5 billion, or 5 percent, in the year to March 31, 2011. The fund with S$193 billion in assets invested in Calgary-based oil and natural-gas explorer Niko Resources Ltd., and Singapore-based agricultural commodities supplier Olam International Ltd.
Temasek’s investments in the U.S. are held primarily in energy and agriculture, Gregory Curl, president and head of the Americas, told an industry conference in Hong Kong yesterday. He said he likes certain commodities such as copper and foodstuff.
Temasek holds 5.5 percent of Rio Tinto Group’s Ivanhoe Mines Ltd., according to a regulatory filing earlier this month.
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