Macro Tsimmis

intelligently hedged investment

Posts Tagged ‘GMBXF.PK’

Sterlite Industries India Ltd. (SLT) update #8

Posted by intelledgement on Sat, 12 Jul 08

Our Indian-based mining/refining company, Sterlite Industries (SLT), announced an agreement earlier this week with the union representing the workers of bankrupt US copper miner Asarco, which SLT have bid to acquire the assets of. The $2.6B bid, which has been accepted by the Asarco board, is on hold pending the bankruptcy court’s review of a rival bid from Grupo Mexico (GMBXF.PK).

SLT’s CEO, Anil Agarwal, stated, “We look forward to working with the unions and Asarco’s highly-skilled employees.” The new collective bargaining agreement fully retains all existing worker benefits. Sterlite has also committed to invest in Asarco’s operations will be improved and made more competitive. The new agreement runs through 2013; it would replace the existing agreement that expires in 2010.

Of course, the new agreement only becomes effective if the SLT acquisition is consummated. But the existence of the agreement can’t hurt Sterlite’s standing with the bankruptcy court when it considers the competing bids.

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Sterlite Industries India Ltd. (SLT) update #7

Posted by intelledgement on Sat, 05 Jul 08

Our Indian buildout play, miner/metals refiner Sterlite Industries (SLT), got more bad news earlier this week concerning their $2.6B buyout of the copper assets of bankrupt copper miner Asarco. Asarco’s former owner, Grupo Mexico (GMBXF.PK), received permission from the US bankruptcy court to present their reorganization plan, which apparently involves reacquiring all of Asarco (including the liabilities).

Grupo Mexico have apparently put as much as $4.1B on the table, although as they are proposing the reacquire all of Asarco, the offer is not directly comparable to SLT’s. It’s likely to take some time for the court to sort through the relative plusses and minuses of the competing offers, and thus the consummation of SLT’s acqusition will be delayed accordingly, at minimum. Speaking of plusses, the court has approved a $52 million breakup fee negotiated by Sterlite and the Asarco board; should the board back out of the deal, Sterlite will be due the fee.

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