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Vale chief, top execs quit in wake of deadly disaster

CEO Fabio Schvartsman's removal had been recommended by state and federal prosecutors.

Rio de Janeiro

BRAZILIAN iron ore miner Vale chief executive Fabio Schvartsman and several other senior executives resigned on Saturday in what the company described as a temporary move, after one of its mining dams burst in January, killing hundreds.

Vale said Mr Schvartsman offered his resignation, which the board "immediately accepted" after state and federal prosecutors recommended their removal late on Friday.

The move comes slightly over a month after a tailings dam broke at Vale's Corrego do Feijao mine in the interior Brazilian state of Minas Gerais, likely killing over 300 people and releasing massive amounts of toxic sludge. It was the second deadly burst at a Vale-linked tailings dam in Minas Gerais in four years.

The resignations came after documents emerged in recent weeks showing that Vale knew it had an elevated risk of rupture and that inspectors felt they were under pressure to certify the structure as safe.

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Earlier this week, newspaper Folha de S.Paulo reported that a Vale manager had told executives the integrity of the structure had worsened, though the company denied the report. The company said it had appointed Eduardo Bartolomeo, executive director of base metals, as the new head of the firm.

Also resigning were Vale's head of ferrous minerals and coal, Peter Poppinga; planning director Lucio Flavio Gallon Cavalli; and Silmar Magalhaes Silva, the head of a geographic division at Vale.

In a letter sent to the board by Mr Schvartsman and published by newspaper Folha de S.Paulo, in which he asked to be removed from the position of CEO on a "temporary" basis, the executive defended his conduct.

"I am absolutely convinced that the way I have acted personally, as well as the rest of our executive board ... has been absolutely appropriate, correct, and, mainly, loyal to our non-negotiable values of upholding operational security as a company," the letter read, according to Folha.

Vale did not immediately respond to a request for comment.

Mr Bartolomeo, the incoming chief executive, was previously the executive director of marketing and of fertiliser and coal operations, according to Vale's website. He also served on Vale's board of directors as well as its compliance and risk committee and financial committee.

According to his LinkedIn profile, he worked as executive director at Vale for eight years until 2012, after which he worked as CEO of Brazil Hospitality Group, then as CEO of Nova Transportadora do Sudeste, a gas pipeline company. He rejoined Vale in January 2018.

He holds MBAs from the Massachusetts Institute of Technology and Katholieke Universiteit in Belgium, the website says. The executives' departure was made public on Saturday evening during Brazil's Carnival holiday weekend. The country's main stock exchange will be closed on Monday and Tuesday although Vale's ADRs will reopen in New York on Monday.

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