Vale SA has initiated paying USD 674 million to the Brazilian government for violating an agreement over mining royalties.
Vale as decided to settle a10 year old dispute with Brazil's federal government, agreeing to pay 3 installments of BRL 100 million in 2012 and remaining one installments of BRL 1.1 billion in the next year.
It became very difficult for Vale to achieve the planned level of earnings as iron ore prices declined in current year. These prices dropped because of China's easing economic growth and a shortfall in the demand for the steel-making ingredient. The Brazilian company is the world's biggest iron ore supplier. Moreover, it is also accountable for over a quarter of sea borne iron ore exports across the world.
Source:
http://www.steelguru.com/raw_material_news/Vale_SA_initiates_paying_USD_674_million_to_Brazilian_govt/295485.html
