September 26, 2018 / 12:46 PM / a month ago

UPDATE 2-Brazil's Vale shareholders reach deal to pay Eletron $692 mln

(Updates to reflect agreement formalized, Litel not waiving right to seek third party reimbursement, fixes formatting of slug)

SAO PAULO, Sept 26 (Reuters) - Two major shareholders of Brazilian mining company Vale SA reached an agreement on Wednesday to pay 2.82 billion reais ($692 million) to holding company Eletron to settle a dispute over Vale shares, according to securities filings.

The payment by Brazilian holding companies Bradespar SA , one of the largest shareholders in Vale, and Litel Participações SA, owned by pension funds, was formalized on Wednesday in court, according to both companies.

Litel and Bradespar were due to pay a roughly 4 billion reais ($981.2 million) judgment awarded by a Rio de Janeiro court in May to fellow shareholder Eletron, a holding company controlled by banker Daniel Dantas.

Each holding company agreed to pay 1.4 billion reais ($343.4 million) in the settlement, according to the securities filings.

The dispute began 10 years ago, tied to an option that Eletron had to acquire Vale shares. Eletron was part of a group that bid in an auction to privatize Vale in 1997.

Pension fund Previ, one of Litel’s shareholders, said in a statement that there is no clause in the settlement preventing Litel from seeing reimbursement from a third party in the matter. ($1 = 4.0766 Brazilian reais) (Reporting by Carolina Mandl; editing by Jeffrey Benkoe and Cynthia Osterman)

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