Brazil's Vale Signs $2 Billion Financing Agreement With Korea Eximbank

RIO DE JANEIRO--Brazilian mining giant Vale SA (VALE) said Friday it has signed a memorandum of understanding with South Korea's export credit agency for up to $2 billion in financing for its projects.

With the agreement, Korea Eximbank "demonstrates its intention to consider" the financial support to Vale, the Brazilian company said.

The deal comes at a time when depressed prices for iron ore and other commodities are weighing on Vale's cash flows. That is forcing the company to sell assets and raise financing to carry out a nearly $17 billion expansion of its Carajas mining complex in northern Brazil.

South Korea's POSCO is one of the world's top steel companies and a partner of Vale in Companhia Siderurgica do Pecem, a major steelmaking project in northeast Brazil.

"The objective of the memorandum is to establish general principles for [financial] cooperation, helping to promote the relationship between Vale and Korean companies," Vale said in a press release.

Write to Paul Kiernan at [e-mail]

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