Sterlite renews interest in Asarco, lowers bid to $2.1 bn

Sterlite renews interest in Asarco, lowers bid to $2.1 bn
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First Published: Thu, Oct 30 2008. 02 15 PM IST
Updated: Thu, Oct 30 2008. 02 15 PM IST
PTI
New Delhi: Speculations are rife that Sterlite Industries has shown renewed interest in buying America’s copper major Asarco for $2.1 billion, which is $500 million lower than the original offer.
Vedanta Group firm Sterlite Industries’ had called off its earlier bid to buyout Asarco last week, saying its original offer of $2.6 billion was over-valued given the global financial meltdown and falling copper prices.
Sterlite Industries spokesperson declined to comment on lowering of the offer price by the company for buying Asarco.
During an investors conference last week, however, company’s Vice Chairman Navin Agarwal had said that Sterlite was “not willing to pay $2.6 billion for the deal”.
The Indian arm of London-listed mining major Vedanta Resources, had asked Asarco to review the purchase price amid the global economic crisis and over 40% dip in copper prices.
Despite terminating the potential deal, Sterlite is said to be working out the possibility of a new purchase agreement.
“We are in discussion with them (Asarco) for a new plan of lower valuation and new terms,” Vedanta Group CFO Tarun Jain had said.
The $50 million, which the company had paid at the time of entering into the definitive agreement, might be at risk if a new deal does not materialise, he added.
Sterlite Industries had inked a definitive agreement in May to buy Asarco for $2.6 billion. The company was to fund the acquisition through a combination of debt and existing cash reserves.
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First Published: Thu, Oct 30 2008. 02 15 PM IST