Asarco gets court OK to pay expenses in $6.482 billion judgment sale

By Jennifer Lanning Drey

Portland, Ore., July 30 - Asarco LLC obtained court approval to reimburse the due diligence expenses of bidders selected to move to a second phase of the stalking horse bidder selection process in connection with the proposed sale of a district court judgment entered in Asarco's favor in April, according to a Wednesday filing with the U.S. Bankruptcy Court for the Southern District of Texas.

As previously reported, the judgment was entered against parent company Americas Mining Corp. in connection with the pre-bankruptcy fraudulent transfer of Asarco's 54.2% stake in Southern Copper Corp. to Americas Mining.

In the motion requesting approval of the expense reimbursement, Asarco said it filed the lawsuit in 2007 against the parent company to avoid the transfer of the shares.

The suit also charged Americas Mining with aiding and abetting and conspiracy in connection with the breach of its fiduciary duties to Asarco's creditors.

In an April court ruling, Asarco was granted 260.09 million shares of Southern Copper common stock worth roughly $5.1 billion and $1.382 billion in cash for damages.

Asarco is now in the midst of a two-part bid selection process in connection with the proposed sale of the judgment.

Initial offers were due by July 16, and Asarco said it has decided to invite a select group of those bidders to move to the second phase of the process.

This select group will be given the chance to conduct additional due diligence.

Binding proposals will be due in the week beginning Aug. 3. At that time, the company said it will decide whether to enter a stalking horse agreement with one of the bidders.

The company said the expense reimbursement will encourage bidders to submit their highest and best offer as part of the auction process.

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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