Brazilian mining giant Vale S.A. (VALE) on Tuesday said it acquired the free floating shares of fertilizer producer Vale Fertilizantes S.A. for a total of R$2.078 billion, equivalent to $1.141 billion.
Through its wholly-owned subsidiary Mineração Naque S.A., Vale successfully concluded a public offer to buy the shares. The company noted that both the common and preferred shares were acquired for R$ 25 per share. Vale will now hold, through Naque, 99.99 percent of the total common shares and 98.09 percent of the total preferred shares of Vale Fertilizantes.
It was on June 30 that Vale announced the public offer, noting that it is consistent with its strategy of becoming a global leader in the fertilizer business, creating significant shareholder's value over the long term.
In the offer, more than 2/3 of Vale Fertilizantes shareholders, who have decided to participate in the auction, accepted the cancellation of its registration as a publicly listed company.
Vale acquired Vale Fertilizantes' 211,014 common shares and 82.92 million preferred shares in the offer. This represents 83.8 percent of the common shares and 94.0 percent of the preferred shares outstanding of Vale Fertilizantes, respectively. These shares correspond to 0.1 percent of the total common shares and 29.8 percent of the total preferred shares of Vale Fertilizantes.
Following the offer, the remaining free floating shares represent less than 5 percent of the total shares of Vale Fertilizantes. Vale noted that a General Shareholders Meeting will be convened in the next days to deliberate about the redemption of the remaining shares. The company will offer the price per share of the public offer, of R$ 25, plus interest based on the SELIC, the Brazilian Central Bank policy interest rate.
Vale added that the financial settlement of the public offer will occur on December 15.
On November 28, Vale's Board of Directors approved the investment budget for 2012, involving capital expenditures of $12.9 billion for project execution, $2.4 billion for research and development and $ 6.1 billion dedicated for sustaining existing operations. On the total investment, 9.6% will be allocated for fertilizers.
VALE shares closed Monday's trading at $22, down $0.80 or 3.51 percent. In the after-hours trading, shares increased $0.02 or 0.09 percent to $22.02.
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