BNDES releases US$ 4.2 billion-credit line to Vale
Gazeta Mercantil - 04/02/2008
With a foreseen investment program of almost US$ 60 billion for the next five years, the Vale do Rio Doce Company received R$7.3 billion (US$ 4.2 billion) of extra resources from the National Bank of Economic and Social Development (Banco Nacional de Desenvolvimento Econômico e Social - BNDES) yesterday. The president of the World's biggest iron ore producer, Roger Agnelli, informed that the intention is to use the credit line - the biggest ever released by the bank to a company - only in projects in Brazil. However, the executive informed that he is negotiating with Chinese, Japanese, and European investment banks other similar credit lines to finance the expansion of projects in the Asian market. The company's investment program foresees the disbursement of US$ 58.9 billion until 2012. Agnelli affirmed that the funds should finance what he classified as Vale's organic growth, without including acquisitions of other companies. For 2008, Vale's disbursements will amount to US$ 11 billion, from which US$ 2.96 billion abroad. The funds financed by BNDES can only be used in the part foreseen for Brazil. Agnelli confirmed that the mining company's disbursements include not only iron ore enterprises - the company's locomotive - but also 18 projects for the development of nickel and copper mines, besides the production of aluminum. Regarding copper, Agnelli justified that the demand for the product tends to grow, proportionally to the expansion, not only of energy projects, but also of construction ones. Unsuccessful in the attempt to purchase Swiss mining company Xstrata, according to the executive, Vale should focus on investments that contribute to expand the company's productive capacity. However, the executive admited resuming talks with Xstrata in case there is a new opportunity for its aquisition. BNDES' financing is part of a line called credit limit, with which the bank contemplated other seven large national groups. Besides petrochemical Braskem, of the Odebrecht group, which received R$ 600 million (US$ 342.9 million), the bank also gave loans to the Gerdau group (R$ 900 million/US$ 514,3 million); Extreme group (R$ 728 million/US$ 416 million); Copesul group (R$ 338 million/US$ 193.1 million); Usiminas (R$ 900 million/US$ 514,3 million); Klabin group (R$ 827 million/US$ 472,6 million); and Elekeiroz (R$ 117 million/US$ 66,9 million). BNDES' president, Luciano Coutinho, justified the credit modality as a more agile financing tool. Thus, he affirmed, the bank does not need to analyze the operations individually. With a 10-year period for amortization, and five years for disbursement, the credit line foresees 20% of remuneration by the variation of the Long Term Interest Rate (TJLP) and 80% by the exchange variation.