Asarco disclosure statement approved; exclusive solicitation period extended; waiting for May 15 cut-off

By Jennifer Lanning Drey

Portland, Ore., May 12 - Asarco LLC received court approval of the disclosure statement for its plan of reorganization Tuesday but will wait to begin soliciting acceptances of the plan until at least the May 15 deadline by which Asarco's parent, Grupo Mexico, must file a competing plan of reorganization, according to an attorney.

There will be a joint disclosure hearing on May 26 if Grupo Mexico files a competing plan by the deadline.

If Grupo Mexico does not file a plan by May 15, Asarco will begin soliciting votes on its plan on that date.

Asarco also received court approval Tuesday to extend its exclusive plan of reorganization vote solicitation period to Sept. 30 from May 18, according to a filing with the U.S. Bankruptcy Court for the Southern District of Texas.

Creditor treatment:

Treatment of creditors under Asarco's plan will include:

• Holders of $441 million to $612 million in administrative claims, $4 million in priority tax claims, convenience claims and priority claims will recover 100% in cash;

• Holders of $28 million to $33 million in secured claims will either be paid in full in cash, plus interest, or have their claims reinstated;

• Holders of $2.1 billion to $2.3 billion in general unsecured claims will recover a percentage of cash based on the size of their claim plus interests in the litigation trusts and the residual assets liquidation trust;

• Holders of demand claims and unsecured asbestos personal injury claims will recover 100% through the asbestos trust;

• Holders of $4 million to $15 million in late-filed claims, subordinated claims, interests in Asarco, interests in the asbestos subsidiary debtors and interests in other subsidiary debtors will receive no distribution.

Asarco, a Tucson, Ariz., mining company, filed for bankruptcy on Aug. 9, 2005. Its Chapter 11 case number is 05-21207.

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