According to news reports, Vale SA announced Wednesday that it plans to sell control of VLI SA--the company's general rail and port cargo unit--to a group of Canadian, Japanese and Brazilian investors. The transaction is expected to be worth approximately 4 billion reais (US$1.79 billion).
Per the conditions of the sale, Mutsui Co. will pay 1.51 billion reais for 20 percent stake; Brazil's FGTS worker compensation and retirement fund will pay 1.2 billion reais for a 15.9 percent stake, and Toronto-based Brookfield Asset Management Inc. is in talks to purchase a 26 percent stake. This would leave Vale with a 38.1 percent stake, while the other three entities will share control of VLI under a shareholder's agreement, gaining access to Vale's ports and warehousing facilities and it running Vale's concessions for the Central Atlantic (FCA) and North-South (FNS) railways. In total, VLI comprises 10,700 kilometers (6,650 miles) of track, 600 locomotives and 13,000 rail cars.