Americas Mining Agrees to Millionaire SettlementBy Antonio Trujillo | Tue, 09/28/2021 - 11:09
Americas Mining Corp. has agreed to settle a US$24.5 million deal in order to address a demand that also involves Southern Copper Corp.
The Grupo México subsidiary announced the cash settlement following a derivative demand, which also named Southern Copper’s administrative board, that accuses both companies from engaging in unfair transactions at the copper producer’s expenses. Should it get approved and the deal carry out, it would free both Americas Mining and the members of the administrative board of Southern Copper from culpability in the demand, stated Southern Copper’s Carla Lacey, who claims the board allowed Grupo México to exploit the company through construction contracts, railway lines usage agreements, and mineral sales, among other contracts.
The offer to solve the demand was presented Tuesday at the Court of Chancery, Delaware. Included in the proposed settlement, Lacey purports to ask for up to US$7.5 million for lawyer and court fees. The settlement also comes two years after Lacey settled a class action lawsuit against transactions related to Southern Copper’s January 2019 sale of two electrical power plants to Grupo México.
Lawyers from both parties, Lacey’s Friedman Oster & Tejtel and Grupo México-Southern Copper, have declined repeated attempts to comment on the situation. In an April 2019 lawsuit, Lacey affirmed that Southern Copper’s board of directors and Grupo México “worked in concert for decades to systematically violate Southern Copper’s requirement that transactions between the two companies be reviewed by independent board directors.”
Lacey states that the board’s failures to follow proper procedure has resulted in the company “entering into grossly unfair deals with Grupo México and its subsidiaries.” At the time the initial complaint was filled, Grupo México owned 88.9 percent of Southern Copper through its Americas Mining subsidiary. Board members have repeatedly denied the allegations, and Grupo México’s claims against it have been dismissed in the past, most recently in October of 2020.
Grupo México’s mining division, one of its many operations as one of the country’s largest conglomerates, is the leading producer of copper in Mexico and only third in the world. The company’s operations go far beyond the borders of the country. Just recently, MBN reported that Peru’s new government, through its Energy and Mines Minister, announced their interest in calling for aid from the company to build a railway megaproject, destined to transport minerals and people from the heart of the mining industry in the Andean mountains to the Pacific coast; and in Spain, also reported by MBN, Grupo México is one of very few final bidders to acquire Spain’s largest mine, a copper producing one called Minas de Aguas Teñidas.