he offering documents were released Thursday, Nov. 18 at the government website (www.cvm.gov.br).
The shares of Fertilizantes will be auctioned Dec. 20.
The Vale announcement said the value of the shares would be the Brazilian Real equivalent of US$12.0185. The offering price released by Vale would take 100 percent control of Fertilizantes.
Vale finalized the purchase of Fosfertil in May of this year. At that time, Vale paid US$3 billion for the Fosfertil shares owned by Bunge Fertilizantes. It also purchased Mosaic Co. holdings in Fosfertil for about US$1 billion.
The move into fertilizers is part of an overall strategy by Vale to secure a global role in the fertilizer industry.
In another move to show its continued interest in potash, the company announced it would spend US$10 billion in Canada on projects, including a potash project in Saskatchewan.
The company announced plans to spend US$3 billion on a new potash mine, pending board approval.
If the Vale board approves, the Vale potash mine would be the first new mine to open in Saskatchewan in years.
Industry sources say Vale moved aggressively on the fertilizer front this year because of pressure from the federal government. Outgoing President Luiz Inacio Lula da Silva called on Vale to ensure a goal of Brazil becoming fertilizer self-sufficient by 2020. Reportedly, the government ministries responsible for approving mining permits for Vale’s other sectors made it clear that the permits would be held up unless Vale was more aggressive on the fertilizer front.
The company had been looking into expanding into more fertilizer-related industries before Lula’s statement.
The incoming CEO, Ricardo Flores, told the Brazilian business journal Valor Economica that he hoped to avoid similar political discussions in the future.
“I think this political, partisan discussion that settled in around Vale doesn’t bring value to the company,” Flores told the paper. “Discussion with a little more political and partisan bias is not part of Vale’s agenda.”
Flores is a former senior credit vice president at Banco do Brasil. His name was submitted for approval as chairman at Vale’s next board meeting on Nov. 25.