| SAO PAULO/RIO DE JANEIRO, June 18
SAO PAULO/RIO DE JANEIRO, June 18 The successful
restructuring of bankrupt oil producer Óleo e Gás Participações
SA will allow Brazilian tycoon Eike Batista to move
forward with plans to cut his own debt, three sources with
direct knowledge of the situation said.
Batista and his EBX holding company have been in talks to
renegotiate about $2 billion owed to Abu Dhabi sovereign wealth
fund Mubadala Development Co PJSC, the sources said.
Batista may offer assets, including stakes in firms he either
controls or has a stake in, to speed up the process, they said.
"Our discussions are continuing," Brian Lott, a spokesman
for Mubadala, told Reuters without elaborating. "We continue to
review assets and opportunities that complement our existing
If the loan is refinanced, it will be the second time both
parties agreed to change the terms of the loan. Soon after
Mubadala bought a 5.6 percent stake in EBX in March 2012, it
converted that equity into debt. EBX was forced to renegotiate
the debt last July as Batista's energy, mining and logistics
Spokespeople and lawyers for Batista and EBX declined to
Now that a judge has approved Óleo e Gás' restructuring and
most other EBX companies have been sold, Batista wants better
terms on the Mubadala deal, a first source said. Óleo e Gás used
to be known as OGX Petróleo e Gás Participações SA, which filed
Latin America's largest-ever bankruptcy petition last year.
The Óleo resolution "is a starting point from which he can
improve his own finances and those of his business," said the
source, who is not authorized to discuss the matter publicly.
A renegotiation could involve Mubadala getting new stock in
or extending loans to EBX companies, a second source said.
Without new investment some of those companies may not be able
to generate revenue needed to repay their debt.
Batista's problems stem from a Óleo e Gás' 2012 revelation
that it could not produce as much oil as promised. Oleo e Gas'
share price sank by more than 90 percent, and other EBX
companies followed, wiping out most of their market value along
with Batista's $30 billion fortune.
The three sources noted that Batista and Mubadala have been
in talks for some time about options. The most likely area for
Mubadala to provide capital is in port operator Prumo Logística
SA and shipbuilding company OSX Brasil SA.
Batista was left with about 20 percent of Prumo after the
August takeover of the company by EIG Global Energy Partners
LLC. Batista and EBX own 50.2 percent of OSX, which filed for
protection from creditors in November.
Because OSX's debts alone could "sink" EBX, a deal with
Mubadala would probably require some effort to keep OSX working
or unravel it in an orderly fashion, said the third source,
adding that Mubadala could also be interested in Batista's stake
in electricity utility Eneva SA.
(Reporting by Guillermo Parra-Bernal and Jeb Blount; Additional
reporting by Stanley Carvalho in Abu Dhabi)