Vale looks at selling $10bn of its core assets, CEO says

Bloomberg

Vale SA, the world’s biggest iron-ore producer, will consider the sale of $10 billion of its best assets by the end of next year as it seeks to reduce its debt load amid sluggish demand.
The Rio de Janeiro-based company also will try to raise $4 billion to $5 billion this year by selling such “non-core” businesses as stakes in its energy assets and seven iron-ore carriers it has on offer, CEO Murilo Ferreira said in a presentation at the Bank of America Merrill Lynch mining conference in Miami.
In February, Ferreira surprised the market by announcing he wanted to cut $10 billion in debt and was willing to achieve that through selling some of its key assets. Until then, Vale’s streamlining efforts centered on cost cutting, moving to higher-quality deposits and selling less-important assets. Vale followed other large miners such as Freeport-McMoRan Inc. and Glencore Plc in stepping up debt-fighting efforts after weakening commodity prices pushed up credit costs and eroded earnings.
For Vale, the February announcement on asset sales followed a $8.57 billion Q4 net loss, capping its first annual loss since a 1997 privatization. Despite Vale’s debt-cutting goal, the company has yet to close any deals for core assets this year. Vale’s efforts to slash debt have been complicated by its plans to start production at its $14 billion S11D project by the second half of this year.