February 13, 2017 / 11:36 AM / a year ago

Politics of Vale succession could keep Ferreira CEO for 2 yrs -Valor Economico

SAO PAULO, Feb 13 (Reuters) - The tricky politics of executive succession at Brazilian miner Vale SA could keep Chief Executive Murilo Ferreira in the job for another two years, newspaper Valor Economico reported on Monday.

Senator Aecio Neves and Vice Governor Antonio Andrade, both from the mineral-rich Minas Gerais state, are pressuring President Michel Temer to influence the selection of a new CEO, Valor reported citing unnamed government and business sources.

The reported tension over the Vale job is the latest sign of strain between the two biggest parties in Temer’s governing coalition.

Neves’s Brazilian Social Democracy Party (PSDB) and Andrade’s Brazilian Democratic Movement Party (PMDB) have butted heads over a string of ministry posts and may run rival candidates in the 2018 presidential election.

Vale was privatized in 1997, but the government continues to wield influence over the company through state development bank BNDES and the pension funds of several state-run companies, which are among Vale’s controlling shareholders.

Reuters reported in January that shareholders could propose Ferreira, whose term expires mid-way through the second quarter, stay on for at least another year, in the context of discussions over a new shareholder accord.

Valor reported that the conflicting pressures over choosing a new CEO had made it more likely that Ferreira would stay on even longer at the helm of the miner, where he arrived in May 2011.

The decision may come along with the renewal of a controlling shareholder agreement that expires in April, the paper reported.

Vale’s press office declined to comment on the report.

Representatives for Neves, Andrade and Temer did not immediately respond to requests for comment. (Writing by Brad Haynes; Editing by Daniel Flynn and David Holmes)

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