ASARCO Announces $100 million share repurchase program and additional sale of Grupo Mexico L shares.NEW YORK--(BUSINESS WIRE)--June 26, 1997--ASARCO Incorporated (NYSE NYSE See: New York Stock Exchange :AR) today announced that its Board of Directors has approved a program to repurchase up to $100 million of Asarco Common Stock. Asarco also announced that it has completed a second private placement of Series L shares of Grupo Mexico S.A. de C.V. (BMV BMV Bolsa Mexicana de Valores BMV Bureau of Motor Vehicles BMV Bundesministerium für Verkehr (German: Federal Ministry of Transport) BMV Below Market Value BMV Brome Mosaic Virus BMV Bedside Medication Verification :GMEXICOL). In the second private placement, Asarco sold 20 million Series L shares of Grupo Mexico at a price of 24.00 pesos per share for gross proceeds of approximately US$60.3 million. On June 12 Asarco announced that it had completed its first private placement of Grupo Mexico L shares. Including the most recent placement, Asarco has now sold 43.3 million Grupo Mexico L shares for total proceeds of US$125.8 million. Based on all of the shares sold, Asarco will record a total after-tax gain of approximately $13.4 million or 31 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. ($20.6 million pre-tax) in the second quarter. Richard de J. Osborne, chairman of the board of Asarco, commented, "Asarco has been able to take advantage of favorable market conditions and realize value for a portion of its investment in Grupo Mexico. Proceeds from our sales of L shares now total over US$125 million. Having made substantial progress in achieving this strategic goal, the Board has approved a share repurchase Share Repurchase A program by which a company buys back its own shares from the marketplace, reducing the number of outstanding shares. This is usually an indication that the company's management thinks the shares are undervalued. program. We will use $100 million of the proceeds to buy back Asarco shares which we believe are significantly undervalued Undervalued A stock or other security that is trading below its true value. Notes: The difficulty is knowing what the "true" value actually is. Analysts will usually recommend an undervalued stock with a strong buy rating. . The remainder of the sales proceeds will be utilized to further reduce debt." The $100 million share repurchase program will reduce shares outstanding by approximately 8.0% based on the current Asarco share price. Currently Asarco has 43.0 million shares outstanding. Purchases of Asarco shares will be made in open market transactions from time to time at then prevailing prices. Following the sale of Grupo Mexico L shares, Asarco still owns 60.9 million L shares representing 8.8% of Grupo Mexico's shares outstanding with a value of approximately $185 million at the 24 peso price for the L shares. In addition, Asarco holds B shares in Grupo Mexico, most of which are subject to a long-term fixed price option, bringing its overall ownership interest in Grupo Mexico to 17.3%. Including these B shares, the value of Asarco's remaining investment in Grupo Mexico is approximately $270 million at current market prices. The shares were sold to institutional investors outside of the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. in transactions exempt from registration under Regulation S and have not been registered under the Securities Act of 1933. The placement was arranged by Credit Suisse First Boston Credit Suisse First Boston was originally the trading name of the Financière Crédit Suisse-First Boston, a London-based 50-50 investment banking joint venture formed in 1978 between the First Boston Corporation and Credit Suisse. . ASARCO Incorporated is one of the world's leading integrated producers of nonferrous metals, principally copper, lead, zinc, silver and molybdenum molybdenum (məlĭb`dənəm) [Gr.,=leadlike], metallic chemical element; symbol Mo; at. no. 42; at. wt. 95.94; m.p. about 2,617°C;; b.p. about 4,612°C;; sp. gr. 10.22 at 20°C;; valence +2, +3, +4, +5, or +6. . Asarco also produces specialty chemicals and aggregates. Asarco had 1996 sales of $2.7 billion. CONTACT: ASARCO Incorporated, New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of Jerry Cooper, 212/510-1810 |
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