Hydro plans to buy Vale's 40 percent stake in Brazilian bauxite producer

Hydro has signed a letter of intent to acquire Brazilian mining company Vale's 40 percent interest in Mineracao Rio do Norte (MRN), a Brazilian bauxite producer. The purchase is contingent on several factors, including approval from both parties' boards and regulatory authoirities.

Vale and Hydro also will request that MRN's shareholders support the transaction. Currently, Vale holds 40 percent of the company, Alcoa 18.2 percent, South 32 14.8 percent, Rio Tinto 12 percent, CBA 10 percent and Hydro 5 percent.

MRN is located in the state of Para and is one of the largest bauxite producers in the world, producing 18 million tons of bauxite per year. The company has almost 1.500 employees.

This is not the first association between Hydro and Vale. In 2011, Hydro purchased Vale's 57 percent interest in the Alunorte alumina refinery, the Paragominas bauxite mine, a 51 percent interest in the Albras smelter and its 61 percent interest in the CAP alumina refinery project, all located in the state of Pará.