Make India Asbestos Free

Make India Asbestos Free
For Asbestos Free India

Journal of Ban Asbestos Network of India (BANI). Asbestos Free India campaign of BANI is inspired by trade union movement and right to health campaign. BANI has been working since 2000. It works with peoples movements, doctors, researchers and activists besides trade unions, human rights, environmental, consumer and public health groups. BANI demands criminal liability for companies and medico-legal remedy for victims.

Wednesday, September 23, 2009

Asarco, Sterlite & Asbestos Claims

Asarco, U.S. copper miner Asarco LLC sought bankruptcy protection in 2005 amid a strike and more than $1 billion in environmental damage and asbestos claims.

Grupo Mexico, the largest copper miner in Mexico, acquired Asarco in a buyout in 1999 but lacks board control because of the bankruptcy. Judge Richard Schmidt of the U.S Bankruptcy Court in Corpus Christi, Texas, had said Grupo Mexico's $2.48 billion plan was better than Sterlite's plan, as it would offer more recovery to creditors. Sterlite has contested that decision and earlier this month Sterlite raised its offer for Asarco to $2.57 billion.

Sterlite Industries, a Anil Agarwal-controlled company has raised its bid for acquiring Asarco, the third-largest copper company in the US, for the third time in two months. The Agarwal controlled company said that the revised bid would now include an all-cash offer of $2.56 billion (about Rs 12,300 crore at current exchange rates), compared with its earlier bid of $2.13 billion that was rejected by the Texas Bankruptcy Court, which had recommended rival Grupo Mexico’s offer instead.

After extensive discussions and review, in order to provide full cash payment to asbestos creditors and to allow late file claims and to provide for surplus cash... for the smooth operations of Asarco, Sterlite increased its offer,” Sterlite said in a statement to BSE.

The cases are In re: Asarco LLC, U.S. Bankruptcy Court, Southern District of Texas, No. 05-21207 and In re: Asarco LLC, U.S. District Court, Southern District of Texas, No. 09-00177.

On 21st September, Sterlite Industries Ltd said that it would release Grupo Mexico SAB de CV from a potential legal liability of nearly $8 billion if the Indian miner can win control of bankrupt U.S. copper miner Asarco LLC.

In a court document filed it said that if a federal court approves its plan to acquire Asarco over rival bidder Grupo Mexico's offer, it would not hold Grupo Mexico liable for more than about $900 million of liability related to the 2003 transfer of a Peruvian mine.

Grupo Mexico has been desperate to regain control of Asarco after a federal district judge found in April that Grupo Mexico had made a "fraudulent transfer" of Asarco's "crown jewel" stake in Peruvian miner Southern Copper Corp in 2003 and ordered Grupo Mexico to return the stake along with a cash payment.

Grupo Mexico is appealing the decision, but until now a central issue in the case has been that the judgment would disappear if Grupo Mexico wins, but would stand if Sterlite were to take over Asarco.

Sterlite said in court papers that it was willing to stipulate that the "net present value" of the judgment was $9.13 billion, and based on that value, it would agree to release Grupo Mexico from most of the obligation.

Sterlite said in the court papers that Grupo Mexico could still appeal the decision and may end up paying nothing to Asarco.

In August, 2009 a federal bankruptcy judge made a nonbinding recommendation that Mexican miner Grupo Mexico be allowed to take control of U.S. copper miner Asarco LLC as it emerges from bankruptcy.

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