GE Invests USD 300 Million in EBX
OREANDA-NEWS. May 24, 2012. GE [NYSE: GE] and Mr. Eike Batista, the founder of the EBX Group (“EBX”) of Brazil, announced that they have signed a strategic investment agreement. Under the terms of the agreement, GE will make a USD 300 million primary investment in exchange for a 0.8% preferred equity interest in Centennial Asset Brazilian Equity LLC and other offshore holding companies (altogether, “Centennial”) of the EBX group. The proceeds will be used to further enhance EBX’s solid capital structure and also help finance Mr. Batista’s pipeline of future investment opportunities, as this is one of the fundamental pillars provided for under the agreement.
This investment is in line with a series of common objectives that GE and EBX group have been focusing on over the past years and further cements the close relationship between the two organizations. It underscores GE's efforts to bring certain industrial production to the LLX Acu Superport, while enhancing GE’s position as a strategic supplier of equipment and services for the EBX Group companies in a number of key industries such as oil and gas, power generation and mining. Moreover, EBX is pleased with GE's decision to accelerate the growth of its existing mining equipment and services business, including the recently announced acquisition of two underground mining equipment companies, Fairchild International and Industrea Limited.
“We are proud to announce this partnership with Eike Batista and EBX, one of Brazil’s and the world’s leading and most dynamic groups,” GE Chairman and CEO Jeff Immelt said. “EBX is already a large GE strategic partner and by strengthening our existing relationship, this investment opens up more opportunities in key resource-rich areas of the world,” Immelt said.
Mr. Batista, founder and controlling shareholder of EBX, said: “GE’s investment further solidifies what has been a great working partnership that taught us the value of having access to GE’s state-of-the-art equipment, services and technologies and worldwide expertise across so many industries, especially because in today’s business environment this is a key component for any large industrial group such as ours. We believe that this transaction deepens the relationship between the two companies.”
"Once again GE makes an innovative move focused on growth opportunities in Brazil. The company believes in this country and this investment will help accelerate the operations of one of GE's strategic partners that, over the years, has played an important role positioning Brazil as an entrepreneurial country on the international stage," says Reinaldo Garcia, President and CEO of GE Latin America.
GE's investment in EBX also reinforces the company's close relationship with another partner, Mubadala Development Company, headquartered in Abu Dhabi. Mubadala was the first to invest in Centennial with a 5.63% stake for USD 2 billion in April 2012.
LEGAL NOTICE: The strategic partnership constitutes a minority investment by GE in Centennial with no changes to the control, management or day-to-day activities of Mr. Eike Batista's publicly listed vehicles: OGX, OSX, MMX, LLX and MPX.
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