Vale SA (ADR) (NYSE:VALE) decided not to renew the contract of current CEO, Roger Agnelli, after it expires in May, and that’s according to Brazil’s Energy Minister Fernando Coelho Filho. According to media reports, President Dilma Rousseff’s government has asked a key Vale shareholder to help replace Agnelli, after years of criticism by politicians that the company is not doing enough to advance Brazil’s economic development. Agnelli stated in an occasion that the decision over the director-president of Vale remains exclusively to the controlling shareholders of the company. He also stated that he has been doing in the last days was the same thing he had done throughout his career.
The Government Faces Political Backslash
The Brazilian government is actually facing a political backlash because of its apparent efforts to force Agnelli out. The government’s stand has ignited concerns over state meddling in Brazil’s private companies. And since the government cannot fire Agnelli directly, but it controls a majority stake in Vale’s controlling shareholder, Valepar, through state pension funds and the state development bank BNDES. Also Guido Mantega – finance Minister- has asked Bradesco, a key Vale shareholder, to help the government replace Agnelli, as per the government sources.
Vale SA Stocks
Vale SA might be a tempting choice for investors, and the reason is the security in the Mining – Iron space visualizing an estimate of strong earnings, and it’s considered a great company among Zacks Industry companies. In fact, that’s an important factor because in a certain industry, a rising tide may lift all boats, as there can be strong bases in a segment maintaining the security among the stock market, like the situation with the Mining – Iron space. It’s currently ranking number 22 out of 250, and over the past month, current quarter estimates have risen remarkably. Current year expectations also are so promising. Actually the company currently is ranking number 3 among Zacks industries. So investing in Vale SA is a very good idea and it’s one of the stable industries that would not change overnight.
