Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Brazilian miner Vale said in a filing on Wednesday it had signed a contract to buy a 45% stake in Alianca Energia from Cemig GT, a subsidiary of energy firm Cemig, for 2.7 billion reais ($540.9 million).
The deal would give Vale 100% ownership of the energy company Alianca Energia, which has assets including seven hydroelectric plants and three wind units.
“The acquisition of the stake in Alianca Energia is an important step towards creating an energy platform, potentially including other energy assets from Vale’s portfolio”, the miner said, adding it will seek for potential partners for the platform once the Alianca deal is closed.
In a separate filing, Cemig said the deal is aligned with its strategy to sell minority stakes it owns.
($1 = 4.9921 reais)
(By Andre Romani; Editing by Steven Grattan)
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