By Rogerio Jelmayer

SAO PAULO--Brazilian mining giant Vale SA (VALE) on Thursday announced the sale of a 36.4% stake in its unit called Minerações Brasileiras Reunidas, or MBR, to an investment fund for 4 billion Brazilian reais ($1.19 billion).

The stake will be acquired by a fund called Participações Multisetorial Plus II, which is controlled by Brazil's giant bank Banco Bradesco SA (BBD).

"This transaction reinforces Vale's commitment to preserve its financial strength, especially in this moment as it completes the largest investment program in its history," Vale said in a statement.

MBR is a subsidiary of which Vale holds 98.3% of the total capital. MBR owns assets for production, transportation and port shipment of iron ore, in mines in industrial plants of Vargem Grande, Abóboras, Pico, Mutuca, Mar Azul and Jangada, which accounted for the production of approximately 65 million metric tons of iron ore in 2014.

"These MBR assets are operationally integrated into Vale's production, transportation and port shipment system known as southern system and are leased to Vale until the year of 2037," Vale said.

After the sale, Vale will hold a stake of 61.9% of the total MBR capital.

Write to Rogerio Jelmayer at rogerio.jelmayer@wsj.com

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