Votorantim Industrial , Brazil's largest diversified industrial conglomerate, will use proceeds from the sale of its stake in steelmaker Usiminas to expand in mining and cement output, chief executive Raul Calfat said.
Calfat told Valor Economico newspaper that the 2.4 billion reais ($1.34 billion) Italian-Argentine rival Techint paid for Votorantim Industrial's 13.5 percent voting stake in Usiminas had boosted the group's cash holdings to 11.5 billion reais.
Swelling cash will allow the investment holding company, controlled by the Ermirio de Moraes family, to forgo borrowing at a time when financial markets remain shut for all but the most credit-worthy companies, Calfat said in the interview, published on Wednesday. It also gives the company room for funding heavy investment plans with its own cash, he added.
Votorantim planned to expand mining operations in Colombia, Peru and Brazil and the group's financial position even allowed it to eye "potential takeover opportunities," Calfat said.
The group's cement unit, Brazil's largest producer of the building material, would get one-third of the Usiminas stake sale proceeds, Calfat told Valor, adding that the money would go to the construction of four factories by 2013.
The group will also focus on output of zinc, aluminum and nickel in Brazil, Calfat told the newspaper. A joint venture to produce long steel products should begin operations by December.
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