April 6 (Bloomberg) -- The organizers of the 2016 Olympics in Rio de Janeiro said today they have surpassed a “conservative” $700 million estimate for local sponsorships with just two deals.
Rio, which was chosen by the International Olympic Committee in October 2009 as the Games’ first South American host, is now aiming to cap local sponsorships at $1.2 billion, which means it won’t require government funds to run the event, said Leonardo Gryner, chief executive officer of the Rio organizing committee. The group won’t try to surpass that figure because organizers aren’t motivated by profits, he said.
The 2016 Games have reached agreements with Banco Bradesco SA, Brazil’s second-largest bank by market value, in a banking category and with Embratel Participacoes SA and America Movil SAB’s Claro, both owned by Mexican billionaire Carlos Slim, for telecommunications. Gryner said both deals were for more than $320 million and set records for local Olympic sponsorships, without providing details.
“We would rather reduce the number of sponsors than increase the overall revenue just to create profit,” Gryner told reporters in London today. “The target we now have is not to require any funds from the government. So we still need to raise one-third of the target.”
The Rio Games will come two years after Brazil hosts soccer’s World Cup.
Brazil’s economy is among the world’s best performers with its currency, the real, rising today to the strongest level since 2008. Last month, the country’s central bank raised its estimate for foreign investment for the year to $55 billion from an earlier $45 million. The economy expanded by 7.5 percent last year.
“We had a good competition in the market,” Grynero said. “The Brazilian economy is booming so we have many companies coming to bid.”
Rio has proposed investments of $11.1 billion in preparation for the Games. Staging the event will inject $51.1 billion into Latin America’s largest economy through 2027 and add 120,000 jobs annually through 2016, according to studies by a Sao Paulo business school for the Sports Ministry.
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