Vale's credit rating drops significantly after dam accident

The ratings agency said Moody's Investors Service downgraded Brazilian iron ore producer Vale to Ba1 from Baa3 globally.

In late January, S&P Global Ratings put Vale bonds on negative control, warning that it could downgrade the BBB rating by several notches, depending on fines and the loss of a license to operate in the affected area.

Fitch Ratings also downgraded Vale at the end of January from BBB + to BBB-, or one notch above the level of the unwanted currency.


Moody's also revised Vale's outlook on all ratings to negative from a previous downgrade. “The negative outlook includes uncertainty about the amount and timing of future cash costs associated with the accident. In addition, it also reflects the risks of ongoing investigations on the cause of the accident and responsibility, ”it was reported.

Moody's action is expected to put further downward pressure on Vale's share price, which opened the market on Wednesday at $ 12.52 per share on the New York Stock Exchange.