Brazil's Eike Batista is no longer a billionaire

A year ago, Eike Batista was the world's 8th richest man, worth $34.5 billion, thanks to his EBX holding company and the six companies under its umbrella, which all deal with natural resources and logistics.

Thanks to an overall market slowdown, Brazil's resource industry has suffered, and his companies lost an overall $10 billion in the last year. Specifically, Batista's oil and gas company, OGX, failed to deliver on production targets and has lost 86 percent of its stock value, and the company's bonds, due to mature in 2018, have fallen by up to 20 percent. Batista's investors have filed an injunction to keep him from selling any company assets.

EBX, the umbrella holding company, has had to refinance a loan from Mubadala Investment Corporation, Abu Dhabi's sovereign wealth fund. Between the $1.5 billion owed to Mubadala and another $2 billion in personal liabilities, Bloomberg reckons Batista's net worth has fallen to $200 million.

Recently Batista wrote an open letter to Brazil's Valor newspaper in which he considers what went wrong and defends himself against criticisms that he misled investors:

I had offers to sell big stakes or even the control of OGX from a valuation of $30 billion. Two years ago, I put more than $1 billion out of my pocket in the company. I lost and have been losing billions of dollars with OGX. Does someone who wishes to mislead the other do so at a cost of billions of dollars? If I wanted, I could have performed a scheduled sale of $100 million every six months over 5 years. I would have pocketed $5 billion and still remain in control of OGX. But I did not. Who lost the most with the collapse in the value of OGX was one shareholder: Eike Batista. No one has lost as much as I did, and it is fitting that it be so.

Photo: Juliana Coutinho

via [Business Insider]

This post was originally published on Smartplanet.com