Billionaire Eurnekian Eyes Brazil Growth With Batista Deal

Argentine billionaire Eduardo Eurnekian is eyeing his third deal in Brazil since 2011 with the purchase of a stake from Eike Batista in a semiconductor venture as he expands operations in Latin America’s largest economy.

Eurnekian’s Corporacion America, which has concessions over Brazil’s Natal and Brasilia airports, is in talks to acquire Batista’s 33 percent stake in the SIX Semicondutores SA startup, Carolina Barros, head of communications for the Argentine billionaire’s holding company, said Jan. 10. He is scheduled to make a visit to SIX’s plant site in Minas Gerais state today, she said later, declining to provide details on the amount or timing of a transaction.

Eurnekian, who has a net worth of at least $1.3 billion, is expanding operations in Brazil after starting production of chips for credit cards, mobile phones and electronic identification in neighboring Argentina last year through a venture called Unitec Blue. Corporacion America has concessions in 49 airports in Latin America and Europe.

In 2011, the company obtained the right to build a terminal near the northeastern city of Natal with Brazilian partners after winning the country’s first airports auction to private investors. The following year the group won a concession to run the airport in capital Brasilia for 25 years.

Higher Margins

SIX, which also counts Brazil’s National Development Bank BNDES and International Business Machines Corp. (IBM) among shareholders, was set up in 2012 to invest about 1.2 billion reais ($509 million) in a semiconductor factory in Ribeirao das Neves, near the Minas Gerais capital of Belo Horizonte. The company plans to make chips for use in industrial and medical applications, a niche that generates higher profit margins, according to its website.

Neither Batista nor a press representative at his EBX Group Co. replied to an e-mail seeking comment on the negotiations. Press officials for BNDES, the government of Minas Gerais and IBM declined to comment. SIX also declined to comment on the possible stake acquisition by Eurnekian.

Corporacion America will invest 200 million reais in SIX, allowing the project to be completed, O Globo columnist Ilimar Franco wrote Jan. 11, without saying how he got the information.

Eurnekian invested an initial $300 million to start output at Unitec Blue in Chascomus, about 120 kilometers (75 miles) south of Buenos Aires. The chipmaker is run by Eurnekian’s nephew Matias Gainza Eurnekian who has also been involved in the negotiations to acquire Batista’s stake, Barros said.

Batista Downfall

Batista, 57, is selling assets after oil deposits he once valued at $1 trillion turned out to be duds, triggering an investor confidence crisis that ended up with his flagship oil producing unit declaring Latin America’s biggest-ever corporate default and requesting protection from creditors in October. In December he agreed to cede control of the unit, renamed Oleo & Gas Participacoes SA, to creditors including Pacific Investment Management Co. and BlackRock Inc. in a deal to convert debt of about $5.8 billion into a 90 percent stake in the oil company.

Batista in October also gave up control of a port-developer venture as EBX shrank operations in an attempt to salvage the businessman’s crumbling commodities empire. The Rio de Janeiro-based entrepreneur, once the world’s eighth-richest person after listing six companies between 2006 and 2012, ceased being a billionaire in July as debt mounted.

To contact the reporters on this story: Juan Pablo Spinetto in Rio de Janeiro at jspinetto@bloomberg.net; Daniel Cancel in Buenos Aires at dcancel@bloomberg.net

To contact the editor responsible for this story: James Attwood at jattwood3@bloomberg.net

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