Not long ago, Eike Batista was the richest person in Brazil and the seventh richest person on the planet, with a net worth of $35 billion. He was married to a Playboy Playmate and famously kept his favorite supercar of the moment parked in his mansion's custom living room. In a glowing 60 Minutes interview that aired in 2015, Eike predicted that within 10 years, roughly right around now) he would be the richest person on the planet with a net worth north of $100 billion. How did that turn out?
Well, he is not worth $100 billion. Even if he was, he'd still be roughly $180 billion away billion away from being the richest person on the planet. Eike's fortune is gone. He's actually $1.2 billion in debt. It gets worse. In 2018, he was slapped with a 30-year prison sentence. The crime? Paying $16.6 million to the then-governor of Rio de Janeiro in exchange for lucrative government contracts, a bribery scheme that was exposed by the Brazilian government's massive "Carwash" corruption probe.
YASUYOSHI CHIBA/AFP/Getty Images
Rise and Fall
Eike Batista's rise and fall are nothing short of stunning.
Eike Batista was born into a prominent Brazilian family, the son of a former mining company executive. He spent part of his youth in Germany, where his father served as Brazil's Minister of Mines and Energy. After studying metallurgical engineering in Germany, he returned to Brazil in the early 1980s and began his career in gold mining and trading.
His rise began when he founded TVX Gold, a mining company that established several gold mines throughout Brazil and Canada. By age 29, he had already amassed his first million dollars. His success in mining led him to create EBX, a group of companies that would eventually span multiple industries.
During the 2000s commodities boom, Batista's fortune grew astronomically. He created various companies, all with an "X" in their name: OGX (oil and gas), MMX (mining), LLX (logistics), MPX (energy), and OSX (offshore services). His timing coincided with Brazil's economic boom, and investors were eager to back his ventures.
In late 2012, Batista's net worth peaked at an estimated $35 billion, making him the seventh-richest person in the world and the wealthiest in Brazil. Unfortunately, August 2012 would prove to be the peak of the worldwide commodities markets. The beginning of his downfall came through OGX, his oil company. After promising massive oil discoveries off the Brazilian coast, OGX admitted in 2013 that it would stop producing oil at its only three operating wells. The company had vastly overstated its oil reserves and production capabilities. This revelation triggered the collapse of Batista's business empire. In the 12 months after August 2012, oil production at OGX, declined 87%. OGX went from producing 750,000 barrels of oil per day to just 15,000. The collapse of mineral prices obliterated Batista's remaining four companies in a similar fashion. To make matters even worse, Eike personally guaranteed $3.5 billion worth of corporate loans, causing a variety of creditors to circle him like vultures. .
As OGX's stock plummeted, investors lost confidence in his other ventures. His companies' values crashed, and his personal fortune evaporated at an unprecedented rate. OGX eventually filed for bankruptcy; it is the largest bankruptcy in the history of Latin America. By 2015, Batista's net worth had become negative due to massive debt. When it was all totaled, his net worth was negative $1.5 billion.
Authorities raided Batista's mansion in 2017. During the raid, they found a safe full of cash, as well as a Lamborghini Aventador, parked in the living room. Batista himself was declared an international fugitive from justice and jailed upon his return. He was arrested and later convicted for paying $16.5 million in bribes to Rio de Janeiro's former governor, Sérgio Cabral. The bribes were part of a larger corruption scandal known as Operation Car Wash (Operação Lava Jato), which exposed widespread corruption in Brazilian business and politics. He was sentenced to 30 years in prison for bribery and money laundering. Marcelo Bretas, the presiding judge over the case, made no bones about precisely why he decided to throw the book at Batista:
"Precisely because he was a world-famous businessman, his criminal business practices were potentially capable of contaminating Brazil's business environment and reputation, causing deep scars to the confidence of investors and entrepreneurs who, in the recent past, saw Brazil as a good investment option."
Eiki was released from prison in August 2019 after a Brazilian appeals court revoked a temporary arrest order that expired.
