Teaching Note | HBS Case Collection | May 2018

Mubadala and EBX: To X or to X It?

by Nori Gerardo Lietz and Sayiddah Fatima McCree

Abstract

On April 3, 2013, Hani Barhoush and Oscar Fahlgren of Mubadala Capital (“Mubadala”) considered how to salvage Mubadala’s $2 billion preferred equity investment of a 5.63% stake in the EBX Group. At the time, EBX was the holding company of a myriad of subsidiaries and was one of the largest conglomerates in Brazil. EBX was founded by the larger-than-life character Eike Batista, at the time one of the wealthiest men in the world. EBX and its subsidiary companies were predominantly focused on commodities-based businesses including oil, gas, coal, and gold extraction, refinement and shipping. At the time of its investment, Mubadala valued the EBX Group at ~$27 billion. But within only 20 months, EBX’s value had declined significantly to ~$0.7 billion.

Keywords: bankruptcy; private equity; Brazil; cross border; negotiations; UAE; oil and gas; Finance; Strategy; Negotiation; Insolvency and Bankruptcy; Private Equity; Restructuring; Energy Industry; Real Estate Industry; Shipping Industry; Financial Services Industry; Banking Industry; Brazil; Middle East;

Language: English Format: Print 10 pages

Citation:

Lietz, Nori Gerardo, and Sayiddah Fatima McCree. "Mubadala and EBX: To X or to X It?" Harvard Business School Teaching Note 218-098, May 2018.

About the Author

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Nori Gerardo Lietz
Senior Lecturer of Business Administration
Finance
Entrepreneurial Management

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