Reuters reported that US copper miner Asarco LLC has filed a lawsuit against one time suitor Sterlite Industries Limited after the Indian resources company backed out of USD 2.6 billion deal to take Asarco out of bankruptcy in 2008.

Asarco, which exited bankruptcy in December 2009 under the control of Mexican miner Grupo Mexico SAB de CV, said in a March 17th 2010 lawsuit that Sterlite had breached its purchase and sale agreement with the miner and forced it to spend more on attorneys fees, marketing and other costs.

Sterlite had bid USD 2.6 billion for Asarco in May 2008 and was chosen by the Asarco management to sponsor the company's bankruptcy exit. It would have been among the largest Indian cross-border deals, but in October 2008, Sterlite withdrew that offer, saying it needed a substantial reduction in price after copper markets dropped. That touched off a battle with Grupo Mexico, which had first acquired Asarco in a leveraged buyout in 1999 and was seeking to regain control of the subsidiary post bankruptcy.

Asarco, based in Tuscon, Arizona, filed for bankruptcy protection in 2005 as it faced a workers' strike and more than USD 1 billion of asbestos and environmental claims.

Sterlite, a unit of London listed Vedanta Resources PLC is appealing a judge's decision approving the sale to Grupo Mexico and is seeking reimbursement of its expenses in other matters pending before the bankruptcy court. After the initial deal with Sterlite failed, both Grupo Mexico and Sterlite entered another round of bidding with lower offers. Grupo Mexico eventually paid about USD 2.5 billion to regain control of Asarco and repay Asarco's creditors in full.

(Sourced from Reuters)