Money News

Sterlite cuts Asarco bid to $1.4-$1.5 bln - paper

NEW DELHI (Reuters) - Sterlite Industries has slashed its bid to buy bankrupt U.S. copper miner Asarco LLC to $1.4 billion-$1.5 billion, well below its last year’s offer of $2.6 billion, the Economic Times reported on Monday.

Sterlite had also proposed to pay almost half of the amount in instalments over a five-year period, the paper said, quoting an unnamed person privy to the development.

Details are expected to emerge on Friday when the Asarco management will update a U.S. bankruptcy court, the person told the paper.

If Asarco’s management accepts Sterlite’s offer, the parties will sign a memorandum of understanding within the next two weeks, the paper said.

It said a Sterlite official declined comment. Reuters could not immediately reach the company for comment.

Sterlite, a unit of London-listed Vedanta Resources Plc, and Asarco’s parent Grupo Mexico have been in negotiations over the deal for months.

Last October, Sterlite backed out of the $2.6 billion deal to buy the company, saying it would need a substantial reduction in price after a drop in the copper markets.

On Feb. 5, a person familiar with the matter told Reuters Sterlite was close to a new deal for Asarco that could be signed in matter of week. He had said Sterlite’s bid would be less than the $2.6 billion offered earlier.

The deal would allow Asarco, which owns three copper mines in Arizona, to exit bankruptcy after seeking court protection from creditors amid a slew of environmental lawsuits in 2005.