January 11, 2017 / 6:30 PM / 2 years ago

UPDATE 1-Brazil's Funcesp says Vale stake sale not under discussion

(New throughout, adds Funcesp comments)

SAO PAULO, Jan 11 (Reuters) - Fundação Cesp, Brazil’s largest private-sector pension fund, said on Wednesday it is not currently holding discussions over the partial or full sale of a 200 million real ($62 million) stake it owns in Vale SA, the world’s largest iron ore producer.

The fund issued a statement after newspaper Valor Econômico published an interview in which Funcesp President Martin Glogowsky said a potential sale would be gauged if it proved advantageous for the fund.

The statement, issued after the interview was published, said Funcesp “has no need for such liquidity.”

Funcesp, as the São Paulo-based fund is known, is the smallest member of a group of domestic pension funds that form part of Vale’s controlling bloc. Funcesp has 1.1 percent of Litel Participações Ltda, an investment vehicle grouping peers Previ Cauixa de Previdência, Petros Fundação and Funcef Fundação dos Economiários.

“The opportunity could be analyzed if it were advantageous at some point, just as the fund does with other assets in the investment portfolio,” the statement said.

Glogowsky’s remarks to Valor came just as the agreement that groups Vale’s largest shareholders in a common bloc is poised to expire. The agreement that created Vale’s controlling bloc was written in 1997, when the mining giant was privatized.

Preferred shares of Vale jumped 2.8 percent to 26.91 reais in late afternoon trading in São Paulo, reaching the highest level in a month. The stock has more than tripled over the past 12 months.

$1 = 3.2172 reais Reporting by Guillermo Parra-Bernal; Additional reporting by Bruno Federwoski in São Paulo; Editing by Chizu Nomiyama

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