Vale 25 billions lawsuit

Vale is being sued to pay BRL 25 billions due to tax contigencies (4.66 per share) that hasn't been provisioned. Since it's being paying since 2008 an average of 1.66 per share in dividends, that amount to be paid is 2.8 times average dividends distributed.

Also, Vale has provisioned just 1.44 billion for tax contingencies and the total possible tax demands hits BRL 40 billions!

In addition to contingencies for which we made provisions, the company is part in claim where the loss expectation is considered possible for Vale and for its attorneys and that represent on September 30, 2011 and December 31, 2010, the total amount of R$ 40,769,086 and R$ 9,605,546 in the consolidated company and R$ 34,262,857 and R$ 4,484,876 on the parent company, respectively. For these cases it was not recorded provision. The variation in the claims values regarding reasonably possible contingencies is related with cases in which is discussed the payment in Brazil, of income tax and social contribution on net income on the profits of foreign subsidiaries.