Asarco swings deal with Mexican firm

U.S. base metal producer Asarco (NYSE) is joining forces with Grupo Industrial Minera Mexico.

An agreement will enable Grupo to merge with Mexico Desarrollo Industrial Minero S. A. de C. V. (MEDIMSA), which is 68.8%-owned by Grupo and 28.3%-owned by Asarco.

With the merger, Asarco’s ownership in MEDIMSA will be converted to ownership in Grupo, a publicly held company.

Grupo is the largest non-ferrous metal miner in Mexico. MEDIMSA owns and operates 13 mines and nine metallurgical plants in the country. Asarco will hold a 23.6% stake in Grupo, while the existing Grupo shareholders will hold 74%.

Meanwhile, Asarco announced an offering of US$50 million of 7% notes, due Dec. 1, 2001. Proceeds will be used to redeem its US$40 million of 9.75% debentures, due in the year 2000, and to repay revolving credit bank borrowings.