Abu Dhabi Sovereign Fund to Enter Ibirapuera Entertainment Complex Bid

SÃO PAULO, BRAZIL – One of the largest sovereign wealth funds in the world, Abu Dhabi’s Mubadala, is preparing to invest heavily in Brazil to expand its participation in the sports and entertainment sectors. The fund is considering participating, through its IMM company, in the bidding for the Ibirapuera complex in São Paulo, an investment that should not be lower than US$100 (R$400) million.

The Ibirapuera complex, which includes a gymnasium and arena, is strategic for IMM because the venue can attract sports and cultural events hitherto unavailable in Brazil, such as NBA basketball games, for instance.

The winner of this bidding process will be in charge of the construction and operation of a multi-purpose space, with capacity for up to 20,000 people, which was originally conceived to be the Brazilian Madison Square.

The largest entertainment market in South America, the city of São Paulo became the main target of IMM’s investment. Once known as IIMX, the fund belonged to businessman Eike Batista, who sold control to the Arab fund in 2015. Mubadala was one of the creditors who inherited part of the X Empire, which was shattered with the businessman’s downfall. It was left with the Açu Port, Hotel Gloria, which is for sale, and mining businesses.

With IMM, Mubadala intends to become a reference in shows and sporting events. Owner of brands such as São Paulo Fashion Week (fashion), Taste of São Paulo (gastronomy) and Rio Open (tennis), IMM also holds strategic partnerships to grow in event organization, such as Cirque du Soleil and the musicals it organizes in São Paulo and Rio.

“We want to turn São Paulo into one of the largest entertainment platforms in South America,” says Alan Adler, IMM’s CEO. Under Adler’s management, IMM is developing a marketing and communication agency, which is still being planned, IMM Creative Marketing, which will be directed by the advertising executive Silvio Matos.

With revenues of R$250 million in 2019, IMM was also involved in talks to take over the organization of Formula 1 in São Paulo.

For the time being, Adler discards making acquisitions of competing businesses. IMM is not interested in being a show house owner. The company owns Tudus, a company that sells tickets online.

According to Carlos Herrera, an analyst at Condor Insider, IMM is growing in a sector that has expanded again in Brazil. “Until 2011, the country was the world power and attracted several shows. But after the crisis, the purchasing power began to decline and the audience for major shows decreased,” he said. For Herrera, however, IMM needs to create an identity for its business. “IMM has no clear market positioning.”

With US$229 billion under management, the Abu Dhabi fund is considering buying Petrobras refineries and investing in oil and gas. The Abu Dhabi fund was one of the investors that came to assess Petrobrás gas pipelines and look at concessions in the country. Contacted, Mubadala did not comment on its expansion in the country.