(Sharecast News) – A Brazilian court has approved the reorganisation plan for BHP’s Samarco joint venture, meaning it can restructure its $3.7bn debt, the Australian mining giant said on Monday.
Samarco, an iron ore miner that is equally owned by BHP and Brazil’s Vale, needs to regorganise its finances after being forced to pay compensation for damage caused by a 2015 dam collapse that killed 19 people.
The plan for allows Samarco to swap its existing debt of $4.8bn for up to $3.7bn of long-term unsecured debt, BHP said.
Samarco’s contribution to fund the reparation will be capped from 2024 to 2030 at $1bn, while BHP Brasil and Vale will be required to provide funding during this period to the extent that the funding amount required exceeds the $1bn cap.
Reporting by Frank Prenesti for Sharecast.com