Mubadala Capital’s Brazil business has been active since 2011 and has built a diversified portfolio of private and public assets through the completion of a number of transactions including mergers and acquisitions, restructurings, corporate carve-outs, bankruptcy workouts and other types of special situations. The Brazil team is based in Rio de Janeiro and supported by the Mubadala Capital offices in New York and Abu Dhabi.
Mubadala Capital’s Brazil team employs an active investment approach, strategically designed to take advantage of attractive investment opportunities in situations of distress, while capitalizing on the team’s unique experience in the local Brazilian market.
The investment strategy is anchored around the following key principles:
- Emphasis on special situation investments across the capital structure, driven by financial strain, distress or complex situations.
- Acquire high-quality businesses at a discount to their intrinsic value, creating a margin of safety at the closing of a transaction that reduce the dependency on Brazil’s economic cycles and currency while retaining the upside exposure associated with a growing economy.
- Front-load risk into deal structuring, negotiation and execution – once a transaction is completed, the situation that created the initial distress, and therefore the discount to intrinsic value, is often resolved.
- Use of a fundamental-driven investment strategy that focuses on financial improvements, value creation and opportunities to structure downside protection.
Mubadala Capital’s Brazil team currently manages third-party capital on behalf of Mubadala and institutional investors, including a special situations fund. Total investments in the country is in excess of U.S. $3 billion.
Typical Investment Parameters
Sector agnostic as transaction characteristics rather than sector focus drive investment decisions.
Primarily focused on Brazil; may opportunistically invest outside Brazil.
U.S. $50-200 million with the flexibility to pursue transactions outside of the targeted range with co-investors.
Typically control or co-control positions, although in cases of debt or structured investments, contractual “control rights” may be utilized.
Ownership / Governance Model
Active portfolio management approach with direct involvement at the board level and below to help drive strategy and value creation.