According to Cailianshe, according to the UK's " Financial Times ", Brazilian mining giant Vale is discussing selling minority stakes in its metals business, with a valuation of US$2.5 billion (about 17.8 billion yuan). The company is seeking to increase its copper and nickel production to meet the growing demand brought about by the energy transition. The report quoted bankers as saying the company is negotiating to sell 10%-15% of its stake in the base metals sector, with the business likely to be valued at about $25 billion.
According to people familiar with the matter, Japan's trading companies, Middle East 's sovereign wealth funds and automobile companies are reviewing the asset, and the first round of bids will be held in early November.
Global demand for copper and nickel is expected to soar due to the energy transition, while supply will be restricted due to scarcity of new ores.
Automakers are especially scrambling to obtain the key metals needed for electric car , and several of them are studying the deal, according to people familiar with the matter.
Vale this year signed an offloading agreement to buy nickel from Canada, indicating that the automaker is working to ensure the safety of the raw material supply chain. Vale also discussed long-term supply contracts for metals with other auto companies such as Ford, General Motors and Volkswagen .
Vale has been working to revamp its base metals division, which includes copper ore and nickel ore in Canada and Indonesian , and appointed a new head of the division late last year.
The Vale's base metals sector struggled last year due to low production, partly due to labor disputes in Canada and fires in Brazil's Salobo copper mine, but production is expected to recover this year.
Vale has hired Goldman Sachs to advise on any possible deals, according to people familiar with the matter.
Vale is reportedly in talks to sell 10-15% of the base metals division, with the business likely to be valued at about $25 billion.
Although Vale is known for its massive iron ore business, providing stable cash flow , the company also has a significant base metals business and is the largest nickel miner outside Asia.
Last week, Vale reorganized its nickel and copper assets in Brazil, and Vale will transfer its copper assets in the country to Salobo Metais SA and its nickel assets to a new joint venture in Brazil. The move laid the foundation for the separate valuation of its base metals division from its iron ore business. Vale said at the time that “there is no decision on a new deal with the base metals business”.
