BHP eyes bid for Brazilian iron ore miner

MINING giant BHP Billiton is close to making a £2bn bid for Ferrous Resources, the Brazilian iron ore miner that made a failed attempt to float on the London Stock Exchange last year.

Ferrous is understood to be the latest target for Marius Kloppers, BHP’s chief executive, who announced in August that the company was planning a $20bn spending spree this financial year after posting record profits of £15.1bn.

The FTSE 100 firm started negotiations with Ferrous earlier this year after a Chinese bidder made a conditional offer for the company, it is understood.

Ferrous, which was founded in 2007, owns assets in Brazil’s “Iron Quadrangle” region of Minas Gerais, one of the world’s best deposits of iron ore, which is used to make steel.

In June last year, the miner pulled out of a London flotation that was expected to value the company at $3.5bn (£2.4bn), citing difficult market conditions.

It has since hired Deutsche Bank to sound out a strategic investor or buyer to help fund its development projects in the Minas Gerais region .

Both BHP and Ferrous declined to comment last night.