Legal ‘noise’ adds to deepening iron-ore rout for Vale
For Brazilian iron-ore giant Vale, a sector-wide rout fueled by tumbling metal prices is being accompanied by a stark reminder of its legal issues.
The company’s shares are down about 12% this week -- including a more than 6% slump Thursday, underperforming peers -- as iron ore prices lose all of their gains this year on worries over Chinese steel output and global growth.
Not helping Vale’s cause this week was a request from Brazilian prosecutors to seize $9.5-billion in assets from the Rio de Janeiro-based company and BHP Group in their capacity as owners of the Samarco venture that filed for bankruptcy protection in April. While a judge denied that request, the news flow underscores the legal uncertainties.
“Undoubtedly, it causes noise and weighs on the feeling of investors, especially foreigners, who follow the situation from afar,” said Itau BBA analyst Daniel Sasson.
Samarco’s judicial recovery process risks disrupting talks over reparations for the 2015 dam disaster that caused its financial distress. Some creditors and the prosecutors claim Vale and BHP should be responsible for covering damage costs.
A final settlement between authorities and Samarco is expected to be reached late this year or early next. While iron ore prices are still high enough for Vale to comfortably put its legal issues to bed, the 40% slump from a mid-May peak will leave less for dividends and investments than previously thought.
Article Enquiry
Email Article
Save Article
Feedback
To advertise email advertising@creamermedia.co.za or click here
Research Reports
Projects
Latest Multimedia
Latest News
Showroom
Stewarts & Lloyds is a leading steel, tube, and engineering product supplier in South Africa.
VISIT SHOWROOM
ATI systems comprises five divisions: electrical assemblies, drives and controls, feedback sensors, enclosures, and strip guiding.
VISIT SHOWROOM
Press Office
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation
