Americas Mining Corporation Funds $1.3 Billion Escrowadmin
Americas Mining Corporation, (AMC), an affiliate of Grupo Mexico SAB de CV, announced that it in connection with its plan to acquire control of its subsidiary, ASARCO LLC, as part of ASARCO’s ongoing Chapter 11 bankruptcy process and to demonstrate the seriousness of its intentions to regain control of its subsidiary, AMC has funded today a $1.3 billion escrow account for the benefit of ASARCO’s creditors.
AMC has been seeking to reclaim full equity ownership of its indirect wholly-owned subsidiary ASARCO LLC since it filed for Chapter 11 protection in August 2005. AMC is in a bidding war with Vedanta, an Indian company, to acquire control of ASARCO.
Under U.S. bankruptcy law, any reorganization plan must be deemed “feasible” in order to be approved by the Court. AMC believes the $1.3 billion escrow funded today provides far more certainty than the $100 million letter of credit Vedanta has proposed to backstop its own plan, half of which was in place when Vedanta breached its prior agreement to buy ASARCO.
Group Mexico believes that the substantial funds it has paid into escrow underscores its commitment to retain ownership of ASARCO and the superiority of its plan to Vedanta’s plan.