Mumbai, May 31 (UNI) Sterlite Industries (India) Limited, a subsidiary of Vedanta Resources plc, the London-based FTSE 100 metal and mining group, and Asarco LLC, a Tucson-based mining, smelting and refining company, announced today that they have signed a definitive agreement for the sale of substantially all the operating assets of Asarco to Sterlite for USD 2.6 billion in cash.
The agreement is subject to the approval of the US Bankruptcy Court for the Southern District of Texas, Corpus Christi Division, and the sale will conclude Asarco's Chapter 11 case.
Asarco, formerly known as American Smelting and Refining Company, is an over 100-year-old company and is currently the third largest copper producer in the United States of America. It produced 235,000 tonnes of refined copper in 2007. Asarco's mines currently have estimated reserves of approximately 5 million tonnes of contained copper. For the year ended December 31, 2007, Asarco had total revenues of approximately USD 1.9 billion.
The asset acquisition will be financed by Sterlite through a mix of debt and existing cash resources.
The integrated assets to be acquired include three open-pit copper mines and a copper smelter in Arizona, US and a copper refinery, rod and cake plant and precious metals plant in Texas, US. The asset acquisition is on a cash-free and debt-free basis. Sterlite will assume operating liabilities, but not legacy liabilities for asbestos and environmental claims for ceased operations.
''We are delighted to have reached agreement on this important acquisition, which is a significant milestone for our Group, Sterlite Chairman Anil Agarwal said in a statement here today.
''This is in line with our stated strategy of leveraging our established skills,'' he added/ ''We are extremely pleased with this agreement,'' said Asarco's President and Chief Executive Officer Joseph F Lapinsky.
''Reaching this agreement with a world class mining company is a giant step forward in our quest to successfully emerge from Chapter 11,'' he said.
''The sale will achieve the overall best value for Asarco, its employees, creditors and the local communities in which we operate,'' he added.
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