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Brazilian mine company Vale nominates new CEO

This May 5, 2010 file photo shows the president of the Brazilian mining giant Vale do Rio Doce, Roger Agnelli,as he speaks to the press after launching the project "Vale Florestar" at the headquarters of the company in Rio de Janeiro. Brazilian mining giant Vale announced on April 1, 2011 it is replacing chief executive Roger Agnelli, following weeks of rumors that the government was pressing for a change at the top of Latin America's largest non-state firm.

Vanderlei Almeida/AFP/Getty Images/Vanderlei Almeida/AFP/Getty Images

Brazilian mining giant Vale on Monday named a new chief executive under withering government pressure, a move that may spark fears of state meddling in Brazil's private sector, but is not expected to dent investor confidence in the firm.

Former Vale executive Murilo Ferreira will have to placate politicians' desires for more investment in infrastructure and steel mills, while giving the massive returns provided by outgoing CEO Roger Agnelli during his ten years in office.

Mr. Agnelli, who helped turn Vale into the world's largest iron ore miner, will leave the post by May 22 after years of criticism by political leaders that he was not doing enough to spur Brazil's economic development.

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"Murilo Ferreira was indicated by the controlling shareholders from a list of three prepared by an international executive search firm," Vale said in a statement.

"The shareholders ... reiterate their recognition of Roger Agnelli for his success in the leadership of Vale in these years."

Vale's board will still have to approve the appointment, the company said.

The designation of an experienced industry hand rather than a politician with a heavy social agenda will likely be seen as good news by shareholders. Investors are keen on Vale's extensive iron and nickel assets, low operating costs, and strong presence in China.

The move by President Dilma Rousseff to push for Mr. Agnelli's ouster has sparked concerns of increased government involvement in Brazil's private sector, and could tarnish her image as a pragmatic leader who can work side-by-side with business.

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