Way Clears For CVRD

US mining concern Phelps Dodge Corporation has ended its acquisition agreement with Canadian nickel producer Inco, thus clearing the way for a hostile takeover by the world’s largest iron-ore producer, Brazilian firm Companhia Vale do Rio Doce (CVRD). Last month CVRD offered around $17.9 billion in cash for Inco, while Phelps Dodge made a similar friendly offer but payable in cash and stock. Despite a recommendation from Inco’s board to accept the Phelps Dodge offer, investors indicated they would reject it in favor of the cash option. They had been due to vote today on a course of action. Inco has paid Phelps Dodge a $125 million break-up fee and may be required to pay a further $350 million.