By Jeffrey T. Lewis


SÃO PAULO--Brazilian energy, transportation and sugar conglomerate Cosan SA said Friday it acquired a 4.9% stake in Brazilian iron miner Vale SA for an undisclosed amount.

Cosan said it bought shares directly and also used a derivatives structure to carry out the transaction. Cosan also structured a second derivatives operation, corresponding to an additional financial exposure of 1.6%, that can be converted into a direct equity stake stake in Vale if approved by Brazil's competition regulator, Cosan said.

The acquisition is part of a strategy to diversify Cosan's portfolio and add assets in sectors where Brazil has a clear competitive advantage, Cosan said.

Vale is "exactly the type of company we seek to invest in, a unique global asset, active in a sector that is fundamental for Brazil and strategic for the world's energy transition," said Luís Henrique Guimarães, chief executive officer of Cosan. "The quality of its iron ore and base metals reserves, including nickel and copper, is essential to enable steel decarbonization and electrification."


Write to Jeffrey T. Lewis at jeffrey.lewis@wsj.com


(END) Dow Jones Newswires

10-07-22 1545ET