Vale, Mitsui Agree on New Terms for Sale of Some Mozambique Assets

RIO DE JANEIRO—Brazilian mining giant Vale SA said it has agreed on new terms for a long-delayed deal to sell some of its Mozambique coal assets to Japan's Mitsui & Co. Ltd. to shore up its cash position.

Under the new terms, Mitsui would pay $255 million for about 14.25% of the Moatize coal mine that is 95% owned by Vale. The Japanese conglomerate would also pay $195 million if "certain conditions, such as the mine's performance," are met.

In the original deal announced in December 2014, Mitsui had agreed to an upfront payment of $450 million.

Including an equity stake Mitsui plans to assume in the Nacala Logistics Corridor, built to transport coal from Moatize to port, Vale said it expects to receive $768 million from the Japanese.

Vale reiterated that it still anticipates receiving another $2.7 billion in project financing from sources including Japanese banks and multilateral lenders.

Vale officials said earlier this year that financing the project had proven more complicated than the companies had expected. Project finance has required negotiations and due diligence with parties including the governments of Mozambique and Malawi, the African Development Bank and the International Finance Corporation.

Benjamin Parkin contributed to this article.

Write to Paul Kiernan at paul.kiernan@wsj.com

(END) Dow Jones Newswires

September 29, 2016 16:45 ET (20:45 GMT)

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