Fitch rates Samarco notes BBB

Fitch Ratings said it assigned Samarco Mineracao SA's proposed senior unsecured notes valued up to $1 billion due 2022 an expected rating of BBB.

According to Fitch, the notes will be issued directly through Samarco and the proceeds will be used to partially fund the company's third pipeline and fourth pelletizing plant project, including related investments and for general corporate purposes.

The outlook is stable.

The agency said Samarco's ratings are supported by its joint ownership profile by two industry leaders, Vale SA and BHP Billiton plc, with each company owning 50% of Samarco. Fitch said it believes Samarco's two strong shareholders, with combined operating EBITDA in 2011 of over $66 billion, would support Samarco in the event of a sovereign-related liquidity crisis due to reputational risk.

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