Vale concludes acquisition of Mosaic stake in Fosfertil for US$1.03bn

Thursday, September 30, 2010

Brazilian mining major Vale (NYSE: VALE) has concluded the acquisition of a 20.3% stake in Brazilian fertilizer company Fosfertil, now Vale Fertilizantes, from US-based fertilizer maker Mosaic (NYSE: MOS) in a deal worth US$1.03bn, Vale said in a statement.

The transaction is part of an agreement set out in February this year. In the early months of 2010, Vale penned contracts to buy 78.9% of Fosfertil's total capital.

The acquisition of Mosaic's stake in Fosfertil accounts for 27.3% of the latter's ordinary shares and 16.7% of preferred shares. Vale paid approximately US$12 per share.

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As a result, Vale now holds 99.8% of Fosfertil's ordinary shares and 68.2% of its preferred shares.

The miner has requested approval from Brazilian securities regulator CVM to launch a mandatory public offer to acquire the outstanding ordinary shares in Fosfertil held by minority shareholders.

"The acquisition is consistent with our goal to become a global leader in the fertilizer business," Vale said.

In Brazil, Vale controls the Taquari-Vassouras mine, in Sergipe state, which in 2009 produced 720,000t of potassium. The company also has potash projects in Carnalina (Sergipe state), Rio Colorado and Neuquen (Argentina), and Regina (Canada), as well as a phosphate project in Evate (Mozambique).

Recently, the phosphate rock mine of Bayovar, Peru, came on stream. It was the first greenfield project completed by Vale in the fertilizer business.