Saturday, 16 Jul 2011
Brazilian steelmaker Usiminas said that it agreed to pay at least USD 1.16 billion to have long term access to iron ore resources, seeking to battle a surge in prices for the key steel ingredient.
Usiminas in a securities filing said that it signed an agreement to rent mining rights owned by MBL Materiais Basicos for the next 30 years. Usiminas will also buy 6 million tonnes of iron ore reserves at USD 12.50 per tonne from MBL, as well as a processing facility.
Mr Wilfred Bruijn who heads the unit responsible for mining at Usiminas in an interview said that "This deal with MBL is the first big step in our upstream integration strategy that will allow us to obtain as much iron ore to meet our needs and produce steel at competitive costs.”
The move reflects Mr Wilson Brumer CEO efforts to make Usiminas, Brazil's No 1 flat steel maker, self sufficient in iron ore and energy by 2015.
Neither company disclosed financial terms for the agreement.
(Sourced from Reuters)
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