Brazil's Batista interested in Foxconn partnership
BRASILIA (Reuters) - Eike Batista, Brazil's richest man, wants to help Taiwanese technology giant Foxconn (2354.TW) with its plans to produce Apple products such as the iPad in the country, the latest twist in a much-hyped deal that could be worth up to $12 billion.
After a meeting with President Dilma Rousseff on Friday, Batista told reporters his EBX group "loves to bring in modernity," adding that Foxconn's planned entry into Brazil "fits perfectly with that."
Batista -- a larger-than-life entrepreneur, with a talent for marketing -- said his EBX group is still working out details of how it could work with Foxconn, the manufacturer of Apple's iPad table, as well as a slew of other products.
"I think that participating and promoting, bringing technology to Brazil, that's something the group always does, and we want to be part of this enterprise, too," Batista added.
The addition of the flamboyant billionaire, who has made his fortune in mining and energy, is only the latest turn to a deal that has hardly lacked drama.
The proposal to build Apple's sleek tablet computers in Brazil was first announced in April by President Rousseff during an official visit to China.
Senior officials hailed the deal as a sign of growing economic ties with Asia and proof Brazil was moving up the value-added manufacturing chain as its economy grows.
With a potential value of $12 billion, the deal brought eye-popping amounts of money with it. Perhaps even more significant, though, was the deal's potential to help boost economic ties between Latin America and Asia's biggest economies.
Yet the idea for a "Brazilian iPad" has prompted skepticism back home, where factories have struggled for years with high taxes, an overvalued currency and a lack of qualified workers due to poor education and a tight labor market.
The deal has seen a rocky road to fruition, as negotiations over tax breaks stalled and Brazil's own deep structural problems, such as a dearth of skilled labor, weighed.
Foxconn Chairman Terry Gou said last week after meeting Rousseff in Brasilia that the company would start producing iPads in Brazil in December.
Funding from state development bank BNDES, likely needed for the deal, has also been a sticking point.
Eike's wealth could help smooth out the path to getting 'Made in Brazil' stickers slapped on Apple's trendy tablets, a move that some economists say could help lower the computer's hefty price in Brazil.
Because of tariffs and taxes, an iPad 2 with 16 gigabytes of memory currently retails for about $900 here, nearly twice the $500 list price in the United States.
And with millions of people leaving poverty to join the middle class and only about 40 percent of households so far owning a computer, Brazil could be a huge market for more of these gadgets.
"What's the most important thing for doing business?" Eike asked. "Is there a market? There is."
(Writing by Luciana Lopez; editing by Andre Grenon)