A lawsuit has been initiated by Asarco (NYSE) challenging the sale by Freeport-McMoRan Gold (NYSE) of its 50% interest in the Santa Cruz copper project in Arizona to Minorco. The suit, filed in New York state, names the gold company, its parent Freeport-McMoRan Inc., Minorco, which is based in Luxembourg and is part of the Anglo American group, and subsidiaries of Minorco.
Asarco, the owner of the other half of the Santa Cruz project, says the sale would damage the joint venture. Asarco also states the sale does not comply with the joint venture agreement.
The joint venture, formed in 1977, is engaged in a research project, 75% funded by the U.S. government, to test the feasibility of in situ mining technology for the extraction of copper from a deep underground deposit.
Freeport-McMoRan recently reported agreement to sell its 61% interest in Freeport Gold to Minorco for about US$428 million. Minorco then announced an offer to purchase all outstanding shares of Freeport Gold, bringing the total purchase price to about US$705 million.
Asarco says it will not appeal a court’s recent denial of a preliminary injunction sought by Asarco against the Minorco offer for Freeport Gold.
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