UPDATE 1-Norway's Norsk Hydro in talks to raise MRN ownership to 45 pct
* Hydro eyes more bauxite ownership in tough market
* Seeks to buy Vale's 40 pct stake in MRN mine
* Hydro declines to indicate price
* Deal will not increase deliveries to Hydro (Adds comments from Hydro and analyst)
OSLO, Oct 9 (Reuters) - Norway's Norsk Hydro has signed an agreement with Brazilian mining company Vale for the possible acquisition of Vale's 40 percent interest in Brazilian bauxite producer Mineracao Rio do Norte (MRN), it said on Friday.
The possible value of the deal was not disclosed. MRN produces bauxite, used to make alumina, which in turn is used to make aluminium. The company can produce 18 million tonnes of bauxite a year.
Norsk Hydro, the world's second-biggest aluminium producer after Alcoa, already had a stake of 5 percent in MRN. It said the purchase of the additional stake would strengthen its global position in bauxite and alumina, but cautioned the deal depended on both sides agreeing terms.
Hydro and Vale will also seek support for the transaction from other MRN shareholders, including Alcoa with 18.2 percent.
Hydro acquired Vale's other Brazilian aluminium assets in 2011, a deal which included commercial agreements for Vale's bauxite offtake in MRN. Hydro spokesman Paal Kildemo noted the deal allows the purchase of bauxite in perpetuity at a fixed price. Continuación...