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Reuters: Brazil's Cemig seeking to sell out of Vale joint venture

Published 11/18/2016, 04:47 PM
Reuters: Brazil's Cemig seeking to sell out of Vale joint venture
  • Cemig (NYSE:CIG) has decided to sell its minority stake in its Brazilian power generation joint venture with Vale (NYSE:VALE), in a deal that could fetch ~2B reais ($590M), Reuters reports.
  • CIG reportedly would dispose of its 45% stake, but Vale wants to remain in the venture since it allows the company to avoid paying higher energy costs; companies that generate energy and use it for production are exempt from certain taxes in Brazil.
  • CIG, controlled by the cash-strapped Brazilian state of Minas Gerais, has been hurt by tepid power consumption amid the country's deep recession and years of rampant borrowing.


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