(RTTNews) - Global Copper Mining Leader Grupo Mexico, S.A.B. DE C.V. (GMBXF.PK: News ) announced Sunday the U.S. District Court has approved the full payment reorganization plan for Asarco LLC, in order to reintegrate the U.S. copper operations of both the companies into one of the world's most competitive, low-cost copper producers. The decision, handed down by Judge Andrew Hanen late Friday, would enable Grupo Mexico subsidiary Americas Mining Corp. to regain control of Asarco. The transaction is expected to close by mid-December.

The proposed plan calls for Grupo Mexico to make a $2.2 billion cash contribution to Asarco for distribution to creditors, along with the disbursement of an estimated $1.4 billion in cash on hand from Asarco's balance sheet. Further, Grupo Mexico would guarantee Asarco's issuance of a one-year promissory note for $280 million payable to the asbestos creditors, and forgive $161 million worth of Asarco upstream tax obligations to AMC. It would also release AMC's claim to a $60 million tax refund which will instead remain with Asarco's operations.

The proposed plan has received committed finance from a syndicate of internationally recognized financial institutions to deliver up to $1.4 billion in financing to Americas Mining. This is in addition to the $800 million contribution from Grupo Mexico, in order to fund the $2.2 billion cash contribution on the closing date.

The ruling was a ratification of the decision made by the U.S. Bankruptcy court Judge Richard Schmidt in August, wherein the Grupo Mexico's offer to repay Asarco's creditors and take it out of bankruptcy was approved. This is seen as an end of a case that is now in the fifth year of bankruptcy proceedings, barring appeals. However, Grupo Mexico has been battling with Sterlite Industries for control of Asarco only since last year.

On September 1, Judge Richard Schmidt of the U.S. Bankruptcy Court for the Southern District of Texas, Corpus Christi Division, issued a formal recommendation to confirm the reorganization plan sponsored by AMC. The judge's recommendation proposes that the federal district court approve the parent companies' plan rather than the one filed by the debtor, Asarco LLC and its sponsor, Sterlite (USA), Inc. As per earlier announcement, any deal is subject to the approval of the U.S. Bankruptcy Court for the Southern District of Texas, Corpus Christi Division.
Putting an end to the year-long battle for control over bankrupt copper mining giant Asarco, the district judge in Brownsville, Texas favored Grupo Mexico's $2.4 billion bid over that of Indian miner Sterlite Industries India Ltd.'s (SLT: News ) $2.5 billion bid, that was backed by Asarco and its main union, the United Steelworkers. Sterlite is a unit of U.K.-listed mining group Vedanta Resources Plc (VDNRF.PK,VED.L: News ).

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