In order to focus on its main business of copper production, Asarco (AR-N) has liquidated some of its other base metal assets.
The New York-based company has agreed to sell its lead division in Missouri to the Renco Group, a subsidiary of privately held lead producer Doe Run.
Foremost in the transaction are the Sweetwater and West Fork underground mines and the Glover smelter and refinery, situated in southeastern Missouri. Sweetwater produced 114 million lbs. lead in concentrates during 1997 and West Fork, 108 million lbs. The Grover refinery cranked out 254 million lbs. refined lead.
Asarco, which will retain a royalty on the properties, expects to make more than US$55 million on the sale, though it will also record a US$20 million pre-tax charge against first-quarter 1998 earnings.
“While the low-cost, integrated lead business in Missouri has been a good business for Asarco, the remaining ore reserves have a limited life and can be more economically mined in conjunction with Doe Run’s operations,” said Asarco Chairman Richard Osborne.
The company plans to sink the funds into long-term growth prospects such as low-cost copper production and specialty chemicals.
The transaction is subject to approval by regulators and both companies’ boards and the successful negotiation of definitive agreements.
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