Brazil's mining giant Vale announced Thursday a deal to sell a 35.9 percent stake in its cargo logistics firm VLI to Japan's Mitsui and a Brazilian government fund.
The transaction, valued at $1.232 billion, calls for the sale of a 20 percent stake to Mitsui for $678 million and 15.9 percent to the Caixa Economica Federal for $543 million, the world's top iron ore producer said in a statement.
Vale, which controls VLI, said it was also in talks to sell another 26 percent stake in the company to a consortiun led by Brookfield Brasil, a subsididary of a Canadian firm.
Vale President Murilo Ferreira also announced his company would invest over $4.1 billion in VLI over the next five years to modernize its railroads.
VLI controls ports, terminals and more than 10,000 kilometers (6,200 miles) of railroads in Brazil.
Ferreira made his announcement after meeting with Brazilian President Dilma Rousseff in Brasilia, the presidential office said.
"Vale is selling assets, suspending projects and focusing on more profitable iron ore activities in a bid to regain profit margins in the face of slumping commodity prices," according to the consulting firm Seeking Alpha.