Fortescue and Vale Sign MOU for Potential Joint Ventures

Fortescue Metals Group Ltd. (ASX:FMG) announced that it’s entered into a non-binding memorandum of understanding (MOU) with Vale SA (NYSE:VALE).
As quoted in the press release:

The Memorandum of Understanding sets out the principles on which Vale and Fortescue have agreed to pursue long term opportunities to create additional value for customers in the Chinese steel industry and enhance the competitiveness of their operations.
The agreement proposes the formation of one or more Joint Ventures for the blending of selected volumes of iron ore from both companies. This new blended product will be developed to suit the long term needs of our customers and improve the efficiency of the supply chain to the steel industry. The agreement also provides a framework for potential investment by Vale in Fortescue through a minority acquisition of shares on market and/or investment in current or future mining assets.
The Memorandum of Understanding is non-binding and subject to agreement on the final terms of any resulting Transaction Documents, any other required approvals including Board approval of each of Vale S.A and Fortescue and relevant regulatory approvals.

Nev Power, CEO of Fortescue, commented:

The Memorandum of Understanding will allow us to work together to deliver long term value to our customers, through the efficient supply of an attractive and competitive new iron ore blend in China.

Click here to read the full Fortescue Metals Group Ltd. (ASX:FMG) press release.