Brazilian steelmaker Companhia Siderurgica Nacional (CSN) is said to be in talks with China’s CBSteel to sell a minority stake at its Congonhas Minerios, the steelmaker’s logistics and mining arm. Congonhas Minerios’ assets include the Casa de Pedra iron ore mine.
According to unnamed media sources, talks were initiated two months ago and represent a major change in the way the company is looking to reduce its debt of about BRL 25.8 billion, according to a media report.
Media reports said CSN was talking only to companies interested in its non-core assets, such as CSN’s terminal in the city of Itaguai and tinmaker Metalic, which was sold in late August for $98 million for Polish manufacturer Can-Pack.
A media report said Congonhas Minerios is “essential” to CSN, since the company produces the iron ore the steelmaker uses at its blast furnaces at its mill in the city of Volta Redonda, in the state of Rio de Janeiro.
Media reports said beside CBSteel, China Development Bank was also interested in joining Congonhas. Initial talks say CSN could sell a stake of up to 30 percent of Congonhas Minerios.
CSN owns 87.52 percent of the companies. The remaining 12.48 percent stake is owned by Asian companies. The remaining stake is not being negotiated.
CBSteel could own up to 26 percent of Congonhas Minerios, media reports said, in case a deal is reached.
According to media reports, in addition to buying a stake at Congonhas Minerios, CBSteel could also sign a long-term contract of 40 years for the supply of iron ore by Congonhas Minerios.