April 8, 2019 / 2:40 PM / 7 months ago

Vale minority shareholders push for board, voting changes: report

FILE PHOTO: A logo of the Brazilian mining company Vale SA is seen in Brumadinho, Brazil January 29, 2019. REUTERS/Adriano Machado/File photo

SAO PAULO (Reuters) - A group of minority shareholders of Brazilian iron ore miner Vale SA have proposed an alternative board member to challenge the independent members within the group of 13 candidates presented by the company’s board, newspaper Valor Economico reported.

Broker Vic DTVM and fund Geracao Futuro Lpar proposed Patricia Bentes as an independent member. She is currently on the board of Minas Gerais-based power producer Cemig as well as a business professor at a Rio de Janeiro university.

Under their proposal, board members would be elected independently using a cumulative voting system and not in a single vote approving all names proposed by the board. Cumulative voting can only be required by shareholders holding at least 5 percent of the company’s capital. The matter will be put to a vote at an April 30 shareholders meeting.

One source close to the board said the minority shareholders do not satisfy the 5 percent minimum-stake requirement and backing from other minority shareholders is needed.

The pressure from minority shareholders reflects skepticism toward Vale’s board and management after a mining dam burst in the town of Brumadinho, killing some 300 people, in the second such disaster in the region in recent years.

The board elected this year will oversee the last year of an agreement overseeing controlling shareholder group Litel, which holds the stakes of pension funds, holding company Bradespar SA and Japan’s Mitsui & Co Ltd, set to expire in November 2020.

Vale declined to comment.

Reporting by Tatiana Bautzer; Editing by Jeffrey Benkoe

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