Asarco parent seeks five-member board of directors in light of exclusion from important decisions

By Caroline Salls

Pittsburgh, Jan. 24 - Asarco, LLC's parent Asarco Inc. requested court approval to modify the subsidiary's corporate governance agreement to provide for a five-member board of directors, according to a Tuesday filing with the U.S. Bankruptcy Court for the Southern District of Texas.

According to the motion, three members of Asarco, LLC's board would be appointed by the parent company, one of which would be current board member Carlos Ruiz Sacristan.

In addition, current directors H. Malcolm Lovett Jr. and Edward R. Caine would remain on the board because their presence on the board has bolstered the court and creditors' confidence in the company's reorganization.

The parent company said the board has been unresponsive to its issues and it has been completely excluded from every important decision, including negotiation of a new collective bargaining agreement and any plan of reorganization negotiations.

Asarco Inc. also said it believes Asarco, LLC's management is considering the possibility of a sale of substantially all of its assets without input from parent Asarco Inc., which is also the company's sole equity holder.

Asarco LLC, a Tucson, Ariz., mining company, filed for bankruptcy on Aug. 9, 2005. Its Chapter 11 case number is 05-21207.

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