US court okays Sterlite's Asarco acquisition

24 April 2009

After a prolonged court war, the US bankruptcy court has ruled in favour of India's largest copper producer, Sterlite Industries, saying that it can acquire Arizona.-based Asarco LLC for $1.1 billion in cash and a $600 million note, rejecting Grupo Mexico's Americas Mining Corp's claims.

Texas judge Richard Schmidt on Wednesday approved the request from Asarco's court-approved board to sign a sale contract with Sterlite Industries.

''Asarco and its board acted in the best interests of the debtors, their estates and all creditors and stakeholders," Schmidt said.

But that will start competition with Grupo Mexico SAB of Mexico City, which owned Asarco but lost control after Asarco filed for Chapter 11 reorganisation in 2005.

In March, Sterlite Industries, a unit of London-listed Vedanta Resources Plc, had offered to buy Asarco for $1.7 billion. Sterlite's deal offers $1.1 billion of cash, plus $600 million of notes. (See: Sterlite to buy US copper mining company Asarco for $1.7 billion).

However, last month Grupo Mexico offered $1.3 billion in cash to regain control of Asarco.

The case was then taken up by the bankruptcy court, which now ruled in favour of Sterlite Industries.