December 03, 2008

Magnesita sells 3% stake to Nippon Krosaki

Reuters reported that Brazilian refractory bricks producer Magnesita has agreed to sell a minority stake to Krosaki Harima Corp of Japan, seeking to boost output and sales to the booming steel and cement sectors. Magnesita will issue new shares and sell a 3% stake to Krosaki, a unit of Nippon Steel Corp at market prices. Financial details were not provided.

Magnesita owns a mine in Brumado in Bahia state, which produces some 285,000 tonnes a year of sintered magnesite. It also produces industrial minerals magnesia and talc. The magnesite is converted into refractory bricks at a factory, which has a capacity of 250,000 tonnes a year.

Magnesita expects the sale will help it secure new technology and funds to boost output and reach new markets in the United States and Europe.

Mr Ronaldo Iabrudi CEO of Magnesita said that "This partnership will allow us to look beyond Latin America and seek opportunities around the world.”

Magnesita, controlled by private equity firms GP Investments and Gavea Investimentos, supplies around 70% of the Brazilian market for refractory bricks.