Minews - Vale transfers Guinea mining stake to BSG Resources

(Minews) - Brazilian mining giant Vale SA said Friday it has transferred its stake in a troubled mining joint venture in the West African country of Guinea back to its partner, BSG Resources Ltd.

The Guinean government stripped the companies of their rights to a highly coveted iron-ore concession in the Simandou region last year. The decision was based on an official report saying that BSG Resources, which is controlled by Israeli billionaire Benjamin Steinmetz, obtained the rights through corruption and subsequently sold a 51% stake to Vale in 2010.

Neither Mr. Steinmetz nor BSG Resources could immediately be reached for comment, but both have denied the allegations.

Vale wrote off the $1.14 billion book value of the asset last year. In a statement, the company said the Guinean government revoked the concession “without any finding of wrongdoing on the part of Vale.”

“The transfer of Vale’s equity stake in the joint venture does not represent any form of settlement with BSGR and Vale has retained rights to pursue BSGR with respect to the loss of Vale’s investment in the joint venture,” Vale said.