MMX Mineracao & Metalicos SA, the iron-ore producer controlled by Brazilian billionaire Eike Batista, rose to a two-week high after financing for its Serra Azul expansion project received initial approval.
MMX, based in Rio de Janeiro, climbed 1.7 percent to 4.14 reais at the close in Sao Paulo today, the highest since Oct. 23. The stock advanced 5.6 percent in the past three trading sessions, beating the 0.9 percent increase of the benchmark Bovespa index.
The company, which is expanding its Serra Azul unit in Minas Gerais state, said today that Brazil’s National Development Bank, or BNDES, gave initial approval for the project’s long-term financing. While the loan is still pending final approval, the announcement is positive for MMX, Barclays Plc analysts led by Leonardo Correa wrote in a note to clients today.
“Final terms of the funding arrangement are still unknown, but this should help mitigate concerns on project execution,” the analysts said. “We would expect investors’ risk perception over the project to gradually improve through year-end.”
The project is budgeted at 4.8 billion reais ($2.4 billion), the company said April 26.