UPDATE 2-Batista's Brazilian iron-ore unit files bankruptcy petition
(Recasts with background)
By Alonso Soto and Jeb Blount
BRASILIA/RIO DE JANEIRO Oct 16 (Reuters) - An iron-ore mining company controlled by Brazilian tycoon Eike Batista filed for bankruptcy on Wednesday, the third time in a year that a unit of the former billionaire's EBX industrial group has sought protection from creditors.
MMX Sudeste Mineracao SA, the company that made the petition, holds nearly all the significant assets of Batista's MMX Mineracao e Metalicos SA, part of an EBX mining, oil, energy, shipbuilding and port group that suffered one of the most spectacular collapses in emerging-market history in 2013.
The move comes as a decade-long commodities boom ends. The price of iron ore .IO62-CNI=SI, the main ingredient in steel, has fallen to around its lowest level in five years.
As China's economy weakens, demand for iron ore and other minerals has dropped. Lower prices have made many new mining projects uneconomic.
The MMX Sudeste petition will probably determine whether parent MMX can continue as a viable company. Delays in developing MMX iron ore mines in Minas Gerais and an iron ore terminal near Rio de Janeiro have crimped MMX revenue while increasing debt.
Expectations that Brazil and its vast commodity resources would prosper as China grew allowed Batista to build an industrial empire worth more than $50 billion and a personal fortune of about $30 billion. It made him Brazil's richest man and the world's seventh-richest as recently as 2012, according to Forbes Magazine.
Failure to meet production promises at his OGX Petroleo e Gas SA oil company in 2012 started a decline in EBX group shares. Continuación...