Brazil steelmaker CSN drafting bid for miner Samarco, source says

SAO PAULO, June 20 (Reuters) – Brazilian steelmaker Companhia Siderurgica Nacional (CSN) is drafting an offer to acquire miner Samarco Mineracao SA, which will be presented to the bankruptcy court judge overseeing its debt restructuring, a person with knowledge of the matter said.

CSN hired restructuring firm RK Partners to draft a proposal to buy control of Samarco, the source said, requesting anonymity to disclose private discussions. Brazilian newspaper O Globo reported on Sunday CSN's interest in Samarco.

RK Partners is reaching out to Samarco shareholders Vale SA and BHP Group Ltd, along with unions and financial creditors, the source said.

An agreement may not be easy, according to the source, due to Samarco's liabilities related to its 2015 disaster in the city of Mariana. Shareholders, which have committed to pay for damages, may resist any proposal to give up control of operations while keeping that liability.

Samarco and Vale did not immediately respond to requests for comment. BHP and press representatives for the group of financial creditors declined to comment.

The judge overseeing Samarco's bankruptcy has scheduled a mediation hearing for Tuesday between two groups presenting competing restructuring proposals, one led by creditors and the other by the unions with the support of Vale and BHP. (Reporting by Tatiana Bautzer Editing by Brad Haynes and Marguerita Choy)

Matt Earle

Matthew Earle is the Founder of MiningFeeds. In 2005, Matt founded MiningNerds.com to provide data and information to the mining investment community. This site was merged with Highgrade Review to form MiningFeeds. Matt has a B.Sc. degree with a minor in geology from the University of Toronto.

By Matt Earle

Matthew Earle is the Founder of MiningFeeds. In 2005, Matt founded MiningNerds.com to provide data and information to the mining investment community. This site was merged with Highgrade Review to form MiningFeeds. Matt has a B.Sc. degree with a minor in geology from the University of Toronto.

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