The Hindu Business Line : Sterlite hikes Asarco bid to $2.56 b

Mumbai, Sept. 11 Sterlite Industries on Friday raised its bid for the US-based copper miner Asarco from $2.135 billion to $2.565 billion. The revised bid is almost at par with the $2.6 billion offered last year.

The revision (for the third time in the last two months) comes after the Texas Bankruptcy Court judgment on September 2, which recommended Grupo Mexico’s $2.2 billion bid to regain control of its company.

“In order to provide full cash payment to asbestos creditors and to provide for surplus cash after closing for the smooth continued operations of Asarco, Sterlite increased its offer from $2.135 billion to $2.565 billion cash on closing,” the company said in a filing to the Bombay Stock Exchange on Friday.

With the latest revision, the entire creditors’ interest in the Supreme Court of Canada litigation trust will be owned by Sterlite. The modification to the plan has been submitted to the District Court for its consideration, which is expected to pronounce its judgment by the end of this month.

Price factor

The sharp rise in copper prices in the last few months might have triggered Sterlite to consider a hike in its bid. When it made its first offer of $2.6 billion, copper was being traded at $7,000 a tonne only to plunge to a low of $3,500-4,000 by end-2008.

With signs of a global recovery, copper is now back on its ascent curve and trading at $6,500 a tonne.

Grupo Mexico acquired Asarco in 1999, but lacks board control due to the bankruptcy filing. The US court had recommended that it take control of Asarco as it was more likely to pay the creditors in full.

The Sterlite scrip was down 3 per cent to Rs 756 on Friday.

Related Stories:
Asarco deal to open US market for Sterlite Industries
Sterlite to buy out Asarco at lower cost in a new deal
Sterlite reaches agreement with Asarco unions
Sterlite has support for US copper co Asarco

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