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Sterlite loses Asarco – Focus on Balco + HZL

November 16, 2009

US district court judge ruled in favor of the $2.5bn bid by Grupo for Asarco. The court, in its decision, said that Grupo’s bid for the US miner was feasible and more likely to close than a sale to Sterlite. The decision is in line with the US bankruptcy court judge recommendation of Grupo’s bid over Sterlite. Grupo would have to close the deal in 30 days.

Sterlite management is unlikely to appeal against the judgment.

We believe the usage of cash in terms of investments in growth projects, minority buy-outs, and further acquisitions remains key going forward. The final arbitration hearing for BALCO is in early December and management expects the closure of BALCO and HZL buy-outs in the current fiscal.

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