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Vale (NYSE:VALE) said late Wednesday it entered into a binding deal with creditors on the parameters for a planned debt restructuring at the Samarco joint venture it shares with BHP Group (BHP).
In a Brazil securities filing, Vale (VALE) said Samarco should emerge from the recovery process with a “lean capital structure” under the terms agreed and that payments to its creditors will be made over time, in line with the JV’s cash flow and ramp-up of operations.
“Samarco’s contribution to fund the reparation will be capped from 2024 to 2030 at $1 billion,” Vale (VALE) said, adding that additional contributions from the JV would depend on “excess cash flow” it generates.
Samarco’s debt problems stem from the 2015 collapse of an iron ore tailings dam in Minas Gerais that killed 19 people and severely polluted the Doce River.
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