Commodities trading firm Trafigura Beheer BV plans to buy iron-ore assets from former billionaire Eike Batista as a port it controls with Mubadala Development Co. in Rio de Janeiro starts shipments.
Trafigura will acquire two mining and iron-ore processing plants from Batista’s MMX Sudeste Mineracao SA after creditors accepted an offer as part of the Brazilian company’s bankruptcy protection plan, the company said in an e-mail. The purchase, which involves MMX’s Tico-Tico and Ipe projects at the Minas Gerais state in southeastern Brazil, is subject to certain conditions, said Amsterdam-based Trafigura, without disclosing financial terms.
“Trafigura and its subsidiaries operate in the ferrous mining s ector and these assets represent an opportunity to expand its businesses, as well as complement the joint investment with Mubadala at the Sudeste port,” the company said in the statement Saturday.
Trafigura and Mubadala, an Abu Dhabi sovereign wealth fund, bought a controlling stake in the company developing the port in Rio state last year from Batista, which developed the project. The port will allow iron ore mined in landlocked Minas Gerais to be exported to Asia and Europe. The facility, located about 90 kilometers (56 miles) west of downtown Rio, is loading a first 80,000 metric-ton iron-ore vessel bound for China, Trafigura said in a separate statement Saturday. The company initially expected to start operations in August 2014, almost a three-year delay from Batista’s most optimistic estimates.
A second shipment of iron ore from Sudeste is scheduled for September, Trafigura said, adding that it expects to double the nominal capacity of the terminal to 50 million metric tons by the end of the year.
Creditors of MMX Sudeste, which filed for bankruptcy protection in October after a collapse in iron-ore prices, approved a reorganization plan Friday, the company said in a filing. The unit is one of the four startups founded by Batista in the last decade that ended up seeking protection from creditors amid mounting debt and missed targets, after the tycoon’s $30 billion-plus commodities empire collapsed in 2013.
Source: Bloomberg
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