New delhi: Countering Grupo Mexico SAB’s bid to acquire bankrupt US miner Asarco Llc, Sterlite Industries India Ltd has increased the cash component of its offer by about $500 million (around Rs2,435 crore) to nearly $2.1 billion and pledged to pay all of Asarco’s unsecured debts in full.
Sweetening offer: Asarco’s metals production plant outside Denver, Colorado. Sterlite’s total bid for Asarco stands at about $2.3 billion. Matt Staver / Bloomberg
“Sterlite Industries...is increasing its offer for purchase of substantially all of the operating assets of Asarco by approximately $500 million... The revised total consideration will increase to cash at closing of approximately $2.1 billion,” the company said in a filing to the Bombay Stock Exchange (BSE).
Sterlite’s revised offer, its second in less than 10 days, rivals Grupo Mexico’s bid for Asarco, which offers a cash portion of $2.2 billion.
Sterlite, owned by the Anil Agarwal-controlled mining company Vedanta Resources Plc., said that besides sweetening its offer it has proposed to support a plan of reorganization and pay Asarco’s unsecured debts.
The company, however, has left deferred payment in the form of notes unchanged at $208 million. “The nine-year copper price participation note of $207.9 million and the put option granted to the Asbestos Creditors against their share of 27% litigation interest remains unchanged,” it said.
All the other terms and conditions in the agreement remain unchanged, it added.
Sterlite’s total bid for Asarco now stands at about $2.3 billion against about $2.4 billion reported to have been offered by Grupo Mexico.
Sterlite also said if it acquires the copper miner, it “...will receive approximately 72.5% interest in the Litigation Trust to be set up by the Debtor in Possession (Asarco) at closing of the transaction to pursue a judgement against Americas Mining Corporation (AMC) awarded by the US district court of Texas, Brownsville Division.”
In April, the Texas court ordered Grupo Mexico-run AMC to return 260 million shares of Southern Copper Corp., another entity owned by the mining group, to Asarco with some related payouts.
On Thursday, Sterlite Industries shares rose 1.44% to end at Rs619.35 on the Bombay Stock Exchange.