MELBOURNE (Standard&Poor's) March 9, 2016--Standard&Poor's Ratings Services today said that Fortescue Metals Group Ltd.'s (BB/Negative/--) announcement of a nonbinding Memorandum of Understanding (MOU) with Vale S.A. has no immediate rating impact. The opportunity to blend a selected volume of iron ore from both companies would optimize their operations and potentially reduce their costs further. In our view, Fortescue's continued effort to explore cost-saving opportunities is key to riding out the industry downturn. However, it is worth noting that the memorandum of understanding is nonbinding and subject to board and regulatory approvals.
