Brazilian flats steelmaker Usiminas announced late last week it has secured BRL 700 million in cash ($224.3 million) from its JV-owned iron ore producer MUSA.
According to a filing at the country’s securities exchange commission, CVM, the board of MUSA unanimously approved the JV to reduce its capital by BRL 1 billion ($320.4 million), considering it “too excessive.”
Since Usiminas is a controlling shareholder at the company with a 70 percent stake, it will receive back BRL 700 million ($224.3 million) in cash, which will help Usiminas to honor its debt restructuring plan signed with creditors last year.
Earlier this year, both Sumitomo and Serra Azul Iron Ore, two minority shareholders controlling 30 percent of MUSA, declined to reduce MUSA’s capital, delaying Usiminas’ plans to use the funds.