Brazilian mining giant Vale has solidified its control over the Baovale iron ore project by acquiring the 50% stake previously held by its Chinese partner, Baoshan Iron & Steel (Baosteel). The move, confirmed by Vale on Thursday February 6, grants the company full ownership of the Agua Limpa mine located in the mineral-rich Minas Gerais state of Brazil.

The Baovale joint venture, established in 2001, has been a key player in the region's iron ore production. The Agua Limpa mine, operated under this partnership, has consistently contributed to Vale's overall output. The original agreement between Vale and Baosteel included a purchase option that allowed Vale to eventually acquire Baosteel's share, a right the Brazilian miner exercised last year.

Vale announced in a statement that the purchase agreement with Baosteel has been officially signed. While the company refrained from disclosing the financial details of the transaction, Brazilian daily Valor Economico reported earlier in the day that Vale's third-quarter report from last year indicated a valuation of 135 million reais (approximately $23.4 million USD) for the 50% stake.

The transaction is not yet finalized. It still requires the approval of Brazil’s antitrust watchdog, CADE (Administrative Council for Economic Defense). This regulatory review is a standard procedure for significant acquisitions and mergers in Brazil, ensuring that such deals do not create anti-competitive market conditions.

The acquisition marks a significant strategic move for Vale, giving them complete oversight of the Agua Limpa mine and its operations. It has strengthened Vale’s position within the competitive global iron ore market.

The move also reflects a broader trend of Vale consolidating its assets and focusing on strategic partnerships that align with its long-term goals. By bringing Baovale fully under its umbrella, Vale demonstrates its commitment to the Brazilian mining sector and its confidence in the continued potential of the Agua Limpa mine.

CADE’s review will likely involve an assessment of the impact of the acquisition on the iron ore market and its potential effects on competition.

Once CADE approves the transaction, Vale will officially assume full control of the Baovale project. The company is expected to integrate the Agua Limpa mine seamlessly into its existing operations and leverage its expertise to maximize the mine's productivity and resource potential. The acquisition solidifies Vale’s position as a leading player in the global iron ore industry and reinforces its commitment to its Brazilian operations.