Reuters reported that Grupo Mexico will close a deal to retake control of its bankrupt subsidiary Asarco in early December and is negotiating the terms of over a billion dollars in loans to fund the deal.

Grupo said that it has USD 1.4 billion financing commitment from bank lenders to help pay for Asarco's reorganization after a US judge ruled in favor of its plan last week.

Mr Jorge Pulido head of the company's investor relations said that Grupo Mexico is seeking loans broken up into a 3 year tranche of USD 550 million and 5 year piece of USD 850 million. We are moving very quickly.

US District Court Judge Mr Andrew Hanen in Brownsville, Texas issued a ruling supporting Grupo Mexico's nearly USD 2.5 billion bid for Asarco to exit bankruptcy over an offer by India's Sterlite Industries Limited.

Mr Jorge Lazalde Grupo Mexico's main lawyer in the Asarco case said that the deal could be completed as soon as December 7th 2009.

Grupo said that it can front USD 800 million and will issue USD 280 million, 1 year promissory note to raise the final tally. Grupo Mexico lost board control due to the bankruptcy and Asarco's board and its union favored Sterlite's USD 2.565 billion bid. The union wants a new contract but Grupo rejected the idea, saying it would extend the existing contract by a year.

Mr Rodrigo Heredia mining analyst of Ixe brokerage said that sterlite can still appeal the decision but its chances might be slim after US Bankruptcy Judge Mr Richard Schmidt in Corpus Christi, Texas, twice recommended Grupo Mexico's plan.

He said that "We are not worried by the USD 1.4 billion in debt needed to pay given its leverage. With Asarco, Grupo will have the largest copper reserves in the world.

(Sourced from Reuters)