Vale to Sell as Much as 49% of Fertilizer Unit in an IPO: Report

Vale S.A. (VALE), the world’s largest iron ore miner which bought assets worth $5.8 billion for its fertilizer business last year, is looking to sell as much as 49% of fertilizer unit in an IPO in the second half of 2011, Bloomberg reports.

The Rio de Janeiro-based company is in talks with financial institutions including Deutsche Bank AG (DB) as part of plans to hire advisors on a sale of between 25 and 49%, Mario Barbosa, head of Vale’s fertilizer unit, said yesterday in an interview with Bberg.

“We are taking all the internal measures for the company to be ready to do the IPO,” Barbosa said. “There is a big demand from people interested to be part of the company.”

Vale CFO Guilherme Cavalcanti said in an interview in London Oct. 20 that the IPO wouldn’t be ready before the second quarter of fiscal 2011. Delays are due to the “bureaucratic” processes, Barbosa said yesterday.

Vale, which bought fertilizer assets to diversify from metals mining, may list the shares on the ‘Novo Mercado’ section of the Brazil’s Sao Paulo exchange and the stock could also trade in other markets abroad including New York.

Shares of Vale S.A. fell 32 cents, or 0.95 percent, to $34.54 as of 11:16 a.m. in New York.

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