Bloomberg reported that Cia Vale do Rio Doce fell the most in more than 3 months in Sao Paulo trading after Lehman Brothers Holdings Inc said it may revive its takeover offer for Xstrata Plc.

Vale dropped by 5% to BRR 47.02, the steepest drop since March 19th 2008. The shares have fallen by 7.4% as compared with a 0.1% gain in the Bovespa index.

Mr Christopher LaFemina Lehman Brothers analyst said that Vale may be building a war chest for a future bid for Xstrata because it is the best fit for the Brazilian company. Vale jumped 4.6% on March 26th 2008 when talks between Vale and Zug, Switzerland based Xstrata broke down, easing concerns that the purchase would have saddled Vale with about USD 50 billion in debt amid a global credit crunch and speculation that commodity prices may fall.

Vale said on June 10th 2008 that it planned to sell as much as USD 15 billion of stock to fund expansion and possible acquisitions. The company abandoned its USD 90 billion bid for Xstrata in March 2008 that would have made it the world's biggest miner.