By Paul Kiernan
RIO DE JANEIRO--Brazilian mining giant Vale SA said Friday it
has transferred its stake in a troubled mining joint venture in the
West African country of Guinea back to its partner, BSG Resources
Ltd.
The Guinean government stripped the companies of their rights to
a highly coveted iron-ore concession in the Simandou region last
year. The decision was based on an official report saying that BSG
Resources, which is controlled by Israeli billionaire Benjamin
Steinmetz, obtained the rights through corruption and subsequently
sold a 51% stake to Vale in 2010.
Neither Mr. Steinmetz nor BSG Resources could immediately be
reached for comment, but both have denied the allegations.
Vale wrote off the $1.14 billion book value of the asset last
year. In a statement, the company said the Guinean government
revoked the concession "without any finding of wrongdoing on the
part of Vale."
"The transfer of Vale's equity stake in the joint venture does
not represent any form of settlement with BSGR and Vale has
retained rights to pursue BSGR with respect to the loss of Vale's
investment in the joint venture," Vale said.
Write to Paul Kiernan at paul.kiernan@wsj.com
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