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Sterlite acquiring Asarco- $2.6billion

June 1, 2008

With copper prices rising with an increasingly bullish breathe scaling a record high on the back of a 6 year bull run. So awash with cash and need for expansion has led Sterlite Industries to acquire Asarco LLC for around $2.6billion USD.
In its first bid of expansion ,overseas, Sterlite has put its money where the mouth is, i.e straight in the den of US.
Asarco has been driven to the state of bankruptcy and Sterlite, India’s fourth largest producer of zinc and copper has pounced on its assets.

With the entire trade deal pegged at around $2.6billion USD, Sterlite has made a strategic move. But the challenge remains, in turning it around. Sterlite Industries on the back of the recent China-Olympic growth, has seen its profits and hence the cash reserves soar quite a bit. But instead of going for extra mines, the copper economics has led to acquiring rivals cheaper. And with Asarco it has agreed to buy three open pit mines, a smelter in Arizona, copper refiner and a host of other auxiliary things.

It remains to be seen though, how Sterlite integrates the new acquisitions

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