Vale

Metal and mining company and the largest producer of iron ore and nickel in the world

Categories

Industrial Manufacturing  

#262

Rank

$60.37B

MarketCap BR

BR Brazil

Country

Summary

Vale S.A., together with its subsidiaries, produces and sells iron ore and iron ore pellets for use as raw materials in steelmaking in Brazil and internationally. The company operates through Ferrous Minerals and Base Metals segments. The Ferrous Minerals segment produces and extracts iron ore and pellets, manganese, ferroalloys, and other ferrous products; and provides related logistic services. 

The Base Metals segment produces and extracts nickel and its by-products, such as gold, silver, cobalt, precious metals, and others, as well as copper. The company was formerly known as Companhia Vale do Rio Doce and changed its name to Vale S.A. in May 2009. Vale S.A. was founded in 1942 and is headquartered in Rio de Janeiro, Brazil.


History

Companhia Vale do Rio Doce was founded in Itabira, Minas Gerais, by the Brazilian Federal Government on 1 June 1942. One year later the Vitória a Minas railroad was inaugurated. The 1950s marked Companhia Vale do Rio Doce's entry into the global iron ore market after the company's mine-railroad-port complex was modernized and iron ore prices doubled. At first, sales were mostly to the United States, but exports to Europe increased over the course of the decade. In 1966, the company inaugurated in Espirito Santo the Port of Tubarão, which was to become the most important port for CVRD and is still used to export iron ore mined from the Iron Quadrangle in Minas Gerais. The company acquired a majority interest in the Carajás Mine, with over 1.5 billion tonnes of iron ore in reserves, in 1970. In 1974, Vale became the world's biggest exporter of iron ore, a title which it still holds today. In 1982, Vale began to diversify after it started to produce aluminium in Rio de Janeiro. In the mid-1980s, profits increased considerably under the leadership of Eliezer Batista, father of Eike Batista. In 1985, Vale started to explore the Carajás Mine in the state of Pará just after the 1,600 mm gauge Carajás railroad was opened.

In 1986, the Ponta Madeira port terminal, which is still used to export iron ore mined at the Carajás Mine, was inaugurated in the state of Maranhão. In March 2017, Vale SA chose a commodities industry veteran, Fabio Schvartsman, as chief executive officer. Schvartsman was CEO of Klabin SA, Brazil's largest paper and cardboard producer, for the previous six years.

Privatization in 1997

In May 1997, despite protests by Vale employees and some politicians, the Brazilian Government auctioned a 41.73% interest in the company, which was sold for R$3.34 billion. The largest interest purchased was a 16.3% stake purchased by Brazilian steel company Companhia Siderúrgica Nacional.

Sale of wood pulp businesses

In 2001, Vale sold its Cenibra wood pulp business for US$670.5 million to focus on mining and logistics. In 2002, Vale sold 100,000 acres of land and the eucalyptus forests thereon related to its wood pulp business for R$137 million.

Sale of steel businesses

In 2000, the company sold its stake in Açominas to Gerdau in exchange for preferred shares in Gerdau. In 2001, Vale sold its stake in Companhia Siderúrgica Nacional for R$520 million. In 2004, Vale sold its stake in CST to Arcelor for US$415.1 million. In 2006, Vale sold its interest in Siderar to Ternium for US$107.5 million. Also that year, the company sold 5,362,928 shares in Usiminas for R$378.6 million. In 2007, the company sold the majority of its stake in Usiminas. In 2009, the company sold its remaining stake in Usiminas.

Acquisitions of Brazilian iron ore companies

In May 2000, the company acquired Sociomex, owner of the Gongo Sôco Mine, with proven reserves of approximately 75 million tons. In May 2000, the company also acquired a controlling interest in Samitri, one of the biggest pelletizing companies in Brazil. In April 2001, the company acquired Ferteco, then the third-largest Brazilian producer of iron ore, with a production capacity of 15 million tonnes per year. In 2006, the company acquired Rio Verde Mineracao for $47 million.

Acquisition of Caemi and acquisition and partial disposition of MBR

On 1 April 2000, Vale offered to pay Mitsui US$277 million for 50% of the common shares and US$150 million for 40% of the preferred stock in Caemi. Caemi owned MBR, Brazil's second-largest iron ore producer, mining over 60 million tonnes per year. The acquisition was approved by European regulators subject to conditions. In September 2003, Vale purchased an additional stake in Caemi from Mitsui for US$426.4 million. On 23 January 2006, the company announced a stock swap merger to acquire the interest Caemi that it did not already own. 

In 2007, increased its ownership in MBR by purchasing additional interest from Mitsui for US$114.5 million. Also in 2007, Vale announced that it will lease the shares of MBR that it did not already own from its 7 Japanese shareholders for a 30-year period. The agreement required the company to pay a total of US$60.5 million in 2007 and US$48.1 million annually for a 30-year period and gave it total control of MBR. In 2015, Vale announced the sale of a 36.4% interest in MBR for R$4 billion.

Diversification into non-ferrous metals, coal and phosphate

In 2001, Vale increased its copper mining operations by purchasing the Sossego mine in Carajas, in northern Brazil, for $48.5 million. In 2005, Vale acquired Canico Resource, owner of a nickel mine in Brazil, after increasing its offer to $865 million. In October 2006, Vale acquired Canadian-based nickel producer Inco for $18.9 billion, including $17.7 billion in cash and the assumption of $1.2 billion in debt. To gain approval from Canadian authorities, Vale promised to continue investments in Canada and not lay off people for 3 years after closing. In 2007, Vale made a major entry into coal mining by acquiring AMCI Holdings Australia for AU$ 835 million. In 2010, Vale launched a public offer to acquire fertilizer and copper producer Paranapanema.In 2010, Vale acquired a controlling interest in Fosfertil via a series of transactions. In June 2011, Jason Chenier and Jordan Fram were killed at the 3,000-foot level of the Frood Mine near Sudbury, Ontario. 

In 2011, the company sold its aluminium business to Norsk Hydro in a US$5.27 billion transaction. In July 2012, Vale sold its ferromanganese plants in Europe to Glencore for $160 million. In 2014, Vale announced the sale of coal assets in Mozambique to Mitsui in a $950 million transaction. In 2014, Vale sold its interest in Fosbrasil S.A., a manufacturer of phosphate-based products. In 2015, the company announced that it would sell a 25% interest in gold produced from its Salobo mine, located in Brazil, to Silver Wheaton for US$900 million. In 2015, the company entered into a letter of intent to sell bauxite assets to Norsk Hydro. On 26 November 2015, Vale announced that it planned to reduce its budget for capital expenditures from US$8 billion in 2015 to US$6.2 billion in 2016, with further reductions to US$4–5 billion by 2018.


Mission

“At Vale, our purpose is to improve life and transform the future. Together. We work to create value for the communities and take care of the planet.”


Vision

“Our values guide us in our purpose of being an increasingly better company for our society and for our employees.”


Key Team

Murilo Muller (Controllership Director & Chief Accountant)

Ivan Fadel (Head of Investor Relations)

Mr. Denis Cuenca (Chief Compliance Officer)

Ms. Marina Barrenne De Artagao Quental (Exec. VP of People)

Mr. Luciano Siani Pires (Exec. VP of Bus. Strategy & Transformation)

Mr. Alexandre Gomes Pereira (Exec. VP of Global Bus. Solutions)

Mr. Alexandre Silva D'Ambrosio (Exec. Vice-Pres of Corp. & External Affairs)


Recognition and Awards
Dow Jones Sustainability Indices: Vale has been included in the Dow Jones Sustainability Indices (DJSI) for 20 consecutive years, starting in 2002. Carbon Disclosure Project (CDP) A List: Vale has been included in the CDP A List for climate change for six consecutive years, starting in 2016. Corporate Equality Index: Vale has earned a perfect score on this index for LGBTQ+ workplace equality for the past three years, starting in 2019. GPTW Brazil: Vale has been named one of the best companies to work for in Brazil for 11 consecutive years, starting in 2011. Valor 1000: Vale has been named the best company in the mining sector in Brazil by Valor 1000, a leading Brazilian business magazine, for eight consecutive years, starting in 2014. Corporate Citizen Company of the Year: Vale has been named the Corporate Citizen Company of the Year in Brazil by the Brazilian Institute of Corporate Citizenship for four consecutive years, starting in 2018.

References
Vale
Leadership team

Mr. Gustavo Duarte Pimenta (Exec. VP of Fin., CFO & Investor Relations)

Mr. Carlos Henrique Senna Medeiros (Exec. VP of Safety & Operational Excellence)

Industries

Industrial Manufacturing

Products/ Services
Natural Resources, Precious Metals
Number of Employees
Above 50,000
Headquarters
Praia de Botafogo, 186 Rio De Janeiro, RJ 22250-145 Brazil
Established
1942
Company Type
Public Limited Company
Company Registration
SEC CIK number: 0000917851
Net Income
Above - 20B
Revenue
Above - 1B
Traded as
VALE
Social Media

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Fri Feb 23 2024
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