By Jeb Blount
RIO DE JANEIRO (Reuters) - Brazilian oil company Petroleo Brasileiro SA (SA:PETR4) said on Wednesday it will spend 10.5 million reais ($3.25 million/£2.4 million) to buy marketing rights to the financially troubled Rio de Janeiro Paralympic Games.
The decision allows Petrobras, as the state-controlled company is known, to become an official sponsor of the event about a week before it is set to begin on Sept. 7. Petrobras joins companies such as Toyota Motor Co (T:7203), BP Plc (L:BP), Visa (N:V) and Samsung (KS:005930) in getting marketing benefits in exchange for financial support.
Reuters reported on Aug. 18 that Petrobras was willing to buy marketing rights valued in the "low millions" of dollars to help the Paralympics.
The Games, which feature athletes with physical and mental disabilities, was forced to make budget cuts as the city and state of Rio de Janeiro, mired in a major Brazilian recession, struggled to pay the 40 billion reais ($12.4 billion) price tag for the 2016 Olympics and Paralympics.
Petrobras' money brings 205 million reais ($92 million) in extra funds Games organizers can draw on, said Mario Andrada the games communication director on a conference call on Wednesday.
The bulk, 150 million reais, is from the City of Rio de Janeiro. The rest, 55 million reais is from Petrobras, the lottery unit of Caixa Economica Federal, a Brazilian government bank, and Apex, Brazil's Trade and Investment Promotion Agency.
Petrobras, which is facing financial difficulties of its own and has debt of nearly $125 billion, was one of several state-owned or controlled companies asked by the government to help meet the Paralympic shortfall.
Petrobras' money will come from its existing 98 million real sports budget for 2016.
The sponsorship deal will allow Petrobras to run advertisements on TV, radio and social media mentioning the Games and featuring "Team Petrobras" athletes it is sponsoring for the Paralympics during the Games themselves, the company said in a statement.
Petrobras will also be able to display its logo at Paralympic venues, set up a stand in the Olympic Park and have its name mentioned in an opening ceremony video, rights normally reserved for sponsors that signed up long ago.
Without new funds, the Rio 2016 organizing committee would not be able to pay national Paralympic bodies for travel, food and uniforms, preventing some countries from competing, a judge, who overturned an injunction prohibiting the use of new public money for the Games, said earlier in August.