Saturday, 16 Jul 2011
MMX Mineracao & Metalicos SA, the iron ore producer controlled by Brazilian billionaire Eike Batista rose after signing an agreement to purchase and ship raw material produced by a rival through one of its ports.
As per report Minerinvest Mineracao Ltda agreed to ship as much as five million tons of iron ore through Superporto Sudeste, a port MMX is building in Rio de Janeiro state, for 10 years starting in 2013, according to a regulatory filing. In exchange, MMX will buy the commodity used in steelmaking from Minerinvest at USD 64 a ton during the same period, a price that Bank of America Corp said that is below market.
Credit Suisse Group AG’s analysts Ivan Fadel and Carlos Louro wrote that “This is a very positive development for MMX’s shareholders. The deal will allow MMX to increase its iron ore sales capacity, without having to disburse any cash amount.”
The transaction needs to be approved by MMX’s and Minerinvest’s boards.
(sourced from Bloomberg.net)
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