Vale Put on CreditWatch by S&P Following Brazil Dam Failure

(Bloomberg) -- S&P Global Ratings placed Vale SA on CreditWatch with negative implications, saying the company could face fines and the possible loss of its license to operate in the affected region after a dam failure in Brazil.

• Ratings on Brazil-based Vale, including the ‘BBB-’ foreign-currency and ‘brAAA’ national-scale credit ratings, are placed on CreditWatch with negative implications
  • Vale’s subsidiaries are also on CreditWatch with negative implications
• S&P could downgrade Vale up to several notches depending on the impacts of the accident
• Vale’s environmental and social liabilities could be substantial, especially considering that such an incident has happened before, said S&P
• Financial obligations for remediation and compensation might be substantial, said S&P
• S&P plans to resolve the CreditWatch placement when all relevant information becomes available

To contact the reporter on this story: Natnicha Chuwiruch in Bangkok at nchuwiruch@bloomberg.net

To contact the editors responsible for this story: Shamim Adam at sadam2@bloomberg.net, Edward Johnson

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