Grupo Mexico Closer to Taking Asarco

Grupo Mexico is moving closer to taking copper miner Asarco as a bankruptcy judge says its offer is better than that of India-based Sterlite Industries. It is now up to a federal district court judge in Brownsville, Texas to make the final decision, expected by the end of November. Grupo Mexico’s plan will contribute $2.2bn in cash to Asarco’s debtors, provide a $280m promissory note, a $200m working capital facility to fund Asarco’s operations after bankruptcy, and a release of Grupo Mexico’s claims against Asarco. Sterlite had offered $2.1bn. An equities analyst at Mexico’s Ixe Grupo Financiero says that because Grupo Mexico is offering to pay cash, it should prevail over Sterlite. However, he explains that the workers’ union’s preference for Sterlite’s bid could tip the scale in the Indian company’s favor. Ixe is keeping its buy recommendation on Grupo Mexico, which closed Tuesday up 13.85% at MXP22.03.