Rio de Janeiro: Mubadala Development Company today confirmed that it has finalized the restructuring of its 2012 $2bn preferred equity investment in the EBX Group, and opened an office in Rio de Janeiro to manage its investment portfolio in Brazil.  

Mubadala initiated the restructuring process in early 2013 when the EBX Group was unable to meet certain obligations under the terms of Mubadala’s original investment. Through a series of restructuring transactions completed between 2013 and 2016, Mubadala received a combination of cash payments, equity interests in former EBX Group companies and other international assets in exchange for retiring the preferred equity investment in EBX.  As of December 31, 2015, the aggregate value of the EBX assets Mubadala has received through the restructuring process exceeds the amount of the original investment.

Carlos Obeid, chief financial officer of Mubadala, commented: ‘The completion of this complex restructuring has enabled us to gain a portfolio of assets which hold attractive, long-term value in sectors aligned with and complementary to core Mubadala businesses, such as metals and mining, infrastructure and real estate.”  

In addition to $300 million in cash, assets that have been transferred to Mubadala as a result of the series of restructuring transactions include:

• Equity interest (32.5%) and royalty bonds (14.5%), in Porto Sudeste, the strategically-located export terminal for Brazil’s main iron-ore producing region.  Since completion of the restructuring involving this asset, Mubadala has increased its ownership in the equity to approximately 48% and the royalty bonds to approximately 28%.  
• Interest in a fund that holds Restaurant Brands International stock (the holding company for Burger King and Tim Hortons).   As of December 31, 2015, the NAV of Mubadala’s interest in this fund was approximately $715m.
• Equity interest in Prumo Global Logistica, the owner of the Acu Superport.  As of December 31, 2015, the value of Mubadala’s equity interest in Prumo was approximately $44m.  
• 100% equity interest in IMM, Brazil’s leading sports & entertainment company, with assets including interests in the Rio Open (through a joint venture with IMG), Rock in Rio and the co-management of Rio 2016 Olympics hospitality.
• 100% equity interest in The Leblon Executive Tower, commercial office space in Rio’s prime business district.  
• 100% equity interest in Minesa (formerly AUX), a Colombian gold mine in early stages of development.
• 100% equity interest in the Hotel Gloria in Rio de Janeiro. 

Obeid further commented: “Our objective is to maximize the value of the assets we have acquired through the restructuring process.  We have relocated some of our top asset management teams to Brazil, and hired local talent to actively manage and grow this portfolio of assets.”