ASARCO Obtains Approval of Order Enjoining Sesa Sterlite
Turnover Order Requires Sesa Sterlite to Satisfy Judgment in Favor of ASARCO
TUCSON, Ariz. -- August 20, 2014
On August 7, 2014, the United States District Court for the Southern District
of Texas denied the request of Indian company Sesa Sterlite Ltd. for an
emergency stay of a turnover order issued by the United States Bankruptcy
Court for the Southern District of Texas.
“We are pleased with this latest ruling,” said Jorge Lazalde, executive
vice-president of ASARCO. “Sesa Sterlite has attempted for years to evade
responsibility for its breach of contract, and this order will help us in our
efforts to enforce the judgment we have obtained.”
In 2012, a U.S. Bankruptcy Court awarded ASARCO $82.75 million in damages as a
result of Sesa Sterlite’s breach of a purchase agreement, but for more than
two years, Sesa Sterlite has refused to pay the judgment. The company’s
refusal led the bankruptcy court to issue a turnover order requiring Sesa
Sterlite to turnover cash, assets and property sufficient to satisfy the
judgment. The turnover order also prevents Sesa Sterlite, and all persons
acting in concert with Sesa Sterlite, from transferring, concealing, or
otherwise disposing of Sesa Sterlite’s property until further order of the
In seeking a stay, Sesa Sterlite argued that the order unfairly restricted its
continuing business operations, including prohibiting Sesa Sterlite from
making dividend payments to the holders of its American Depositary Shares
(NYSE: SSLT) scheduled for payment on or before August 8, 2014.
The District Court denied the stay, saying, “Sterlite agreed to be governed by
United States law back in 2008 when doing so was to its advantage, and only
complains now when it may be brought to answer for its 2008 breach of
The turnover order also impacts Sesa Sterlite’s previously issued $500 million
in 4% Convertible Senior Notes in the U.S. debt market, which are scheduled to
mature on October 30, 2014. If Sesa Sterlite fails to pay the judgment to
ASARCO by October 30, 2014, the turnover order prohibits and enjoins Sesa
Sterlite and those acting in concert with it from making or transferring
principal and interest payments on the Notes.
“ASARCO will continue to pursue its legal rights under the judgment and the
turnover order,” said Mr. Lazalde. “We are committed to holding Sesa Sterlite
accountable for its conduct here in the United States.”
About ASARCO LLC
ASARCO was organized in 1899 as American Smelting And Refining Company.
Originally a consolidation of a number of lead-silver smelting companies, the
Company has evolved over the years into an integrated producer of copper, and
other metals. The Company is a fully integrated miner, smelter and refiner of
copper in the United States. ASARCO’s domestic mines annually produce
approximately 350 – 400 million pounds of copper. Significant copper mines
include the Mission, Silver Bell and the Ray open-pit mines, all three in
Arizona. For more information, visit www.asarco.com.
Paul Nathanson, 202-828-1714
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