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Mitsui to possibly boost stake in Vale: Reuters
Posted on Wednesday, 11 July 2018 12:37
Mitsui may increase its stake in Brazilian iron ore company Vale, a senior executive of the Japanese trading house told Reuters in an interview.
A possible investment would happen, Yukio Takebe told the news provider, if Mitsui were to acquire shares from some existing stockholders in a move which would allow it more influence over Vale’s management.
Earlier this month, Reuters reported that BNDES Participações and pension funds led by Caixa de Previdência dos Funcionários do Banco do Brasil are considering selling 3.6 per of the target for BRL 8.00 billion (USD 2.00 billion).
When asked by the news provider if the company would seek to buy some or all of this minority stake, Takebe stated it was unlikely but would not rule out the possibility.
Mitsui’s mineral and metal resource business focuses on investments in iron ore and coal, and first purchased a 15.0 per cent share in the Vale’s holding company in 2003.
Takebe told Reuters that iron ore output remains a priority for this division, which increased its output from equity stakes in mines from 60.90 million tonnes to 64.00 million tonnes in two years, ending March 2017.
He also told Reuters that Mitsui could invest in new areas, such as lithium, so it can own assets for upcoming deals that might prove beneficial.
The news provider reports that the firm would approach batteries for electric cars cautiously as most of the business enticements may already be taken, which would force new entrants to pay higher prices for products in less advantaged locations.
According to Zephyr, the M&A database published by Bureau van Dijk, there have been 23 deals targeting iron ore miners announced worldwide since the beginning of 2018.
The largest of these is worth USD 242.65 million and took the form of a public takeover of iron ore and lithium exploration services company Atlas Iron by Redstone.
© Zephus Ltd