================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
__________________
Schedule 14D-9
(Amendment No. 1)
SOLICITATION/RECOMMENDATION STATEMENT
PURSUANT TO SECTION 14(d)(4) OF THE
SECURITIES EXCHANGE ACT OF 1934
_________________
Cyprus Amax Minerals Company
(Name of Subject Company)
Cyprus Amax Minerals Company
(Name of Person Filing Statement)
Common Stock, No Par Value
(Including the Associated Preferred Share Purchase Rights)
(Title of Class of Securities)
_________________
496902 10 7 (Common Stock)
(CUSIP Number of Class of Securities)
__________________
Philip C. Wolf, Esq.
Senior Vice President, General Counsel and Secretary
Cyprus Amax Minerals Company
9100 East Mineral Circle
Englewood, Colorado 80112
(303) 643-5000
(Name, address and telephone number of person authorized to receive
notice and communications on behalf of the person filing statement)
__________________
Copy to:
Elliott V. Stein, Esq.
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, New York 10019
(212) 403-1000
================================================================================
<PAGE>
This statement amends and supplements the Solicitation/Recommendation
Statement on Schedule 14D-9 of Cyprus Amax Minerals Company, a Delaware
corporation ("Cyprus Amax"), filed with the Securities and Exchange Commission
(the "Commission") on September 9, 1999 (the "Schedule 14D-9"), with respect to
the exchange offer made by Phelps Dodge Corporation, a New York corporation
("Phelps Dodge"), to exchange Phelps Dodge common stock, par value $6.25 per
share, for all of the outstanding shares of Cyprus Amax common stock, no par
value ("Cyprus Amax Common Stock"), on the terms and conditions set forth in the
Phelps Dodge Offer.
Capitalized terms used and not defined herein shall have the meanings
assigned to such terms in the Schedule 14D-9.
Item 9. Material to be Filed as Exhibits
Item 9 of the Schedule 14D-9 is hereby amended and restated as follows:
Exhibit 1: Pages 62, 64-66, 72-73 and 79 in the Joint Proxy
Statement/Prospectus and page 13 in the Asarco Cyprus 8-K.**
Exhibit 2: Pages 11-22 in the Annual Proxy Statement.**
Exhibit 3: Press release issued by Cyprus Amax and Asarco, dated September
9, 1999.**
Exhibit 4: Letter to Stockholders of Cyprus Amax, dated September 9, 1999.* **
Exhibit 5: Complaint filed in Phelps Dodge v. ASARCO et al., Superior Court
of New Jersey Chancery Division: Mercer County, August 27, 1999.**
Exhibit 6: Complaint filed in Sterns v. McAllister et al., Superior Court
of New Jersey Chancery Division: Mercer County, August 24, 1999.**
Exhibit 7: Complaint filed in Greenfield v. Osborne, et al., Superior Court
of New Jersey Chancery Division: Mercer County, August 25, 1999.**
Exhibit 8: Complaint filed in Steiner v. Cyprus Amax et al., Court of
Chancery of the State of Delaware in and for New Castle County,
August 23, 1999.**
Exhibit 9: Complaint filed in Miller v. Cyprus Amax et al., Court of
Chancery of the State of Delaware in and for New Castle County,
August 23, 1999.**
Exhibit 10: Complaint filed in Bruno v. Stookey et al., Court of Chancery of
the State of Delaware in and for New Castle County, August 24,
1999.**
-1-
<PAGE>
Exhibit 11: Complaint filed in Green v. Stookey et al., Court of Chancery of
the State of Delaware in and for New Castle County, August 24,
1999.**
Exhibit 12: Complaint filed in Lifshitz v. Stookey et al., Court of Chancery
of the State of Delaware in and for New Castle County, August
24, 1999.**
Exhibit 13: Complaint filed in Klotz v. Ward et al., Court of Chancery of
the State of Delaware in and for New Castle County, August 24,
1999.**
Exhibit 14: Complaint filed in Grill v. Stookey, et al., Court of Chancery
of the State of Delaware in and for New Castle County, August
26, 1999.**
Exhibit 15: Complaint filed in Phelps Dodge v.Cyprus Amax, et al. Court of
Chancery for the State of Delaware in and for New Castle County,
August 27, 1999.**
Exhibit 16: Letter from Cyprus Amax and Asarco to shareholders, dated
September 10, 1999.
Exhibit 17: Newspaper Advertisement by Cyprus Amax and Asarco dated
September 10, 1999.
Exhibit 18: Investor Presentation by Cyprus Amax and Asarco.
_________________
* Included with Schedule 14D-9 mailed to stockholders.
** Previously Filed
-2-
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this Statement is true, complete and
correct.
CYPRUS AMAX MINERALS COMPANY
By:
/s/ Philip C. Wolf
----------------------------------
Philip C. Wolf
Senior Vice President,
General Counsel and Secretary
Dated: September 10, 1999
-3-
EXHIBIT 99.16
AN IMPORTANT MESSAGE
THE ASARCO CYPRUS MERGER:
THE ONLY TRANSACTION THAT YOU CAN COUNT ON
TO DELIVER VALUE
Dear Cyprus Amax and Asarco Shareholders:
The Boards of Directors of Cyprus Amax and Asarco unanimously recommend that
shareholders VOTE FOR the proposed merger of Cyprus Amax and Asarco on September
30. The Boards and managements of both companies are convinced that only this
transaction delivers to you your fair share of the value of combining our two
companies. The Boards, assisted by their independent financial and legal
advisors, thoroughly reviewed Phelps Dodge's exchange offers and determined they
are inadequate and not in the best interests of Cyprus Amax and Asarco
shareholders. The full details of these determinations are contained in the
Schedule 14D-9 which is being mailed to you separately.
In recommending the Asarco Cyprus merger, the Boards view shareholders as having
the opportunity:
o To be the owners of the largest publicly-traded copper company in the
world with an estimated cash cost of 50 cents per pound;
o To benefit from 100% of an estimated $275 million of annual savings
achievable from our combination;
o To receive an immediate special cash payment of $5.00 per Asarco
Cyprus share, following completion of the proposed merger on
September 30.
In short, the new Asarco Cyprus will be a premier copper investment.
IN THE 3-WAY DEAL PROPOSED BY PHELPS DODGE, WE BELIEVE ASARCO CYPRUS WOULD
BRING:
o 57% of production o 60% of the copper margin
o 61% of reserves o 92% of the synergies
o Lower cash costs o 91% of the cash
o 4 of the 5 lowest cost
mines
IN SHARP CONTRAST, PHELPS DODGE WANTS TO TAKE A SUBSTANTIAL PERCENTAGE
OF YOUR VALUE FOR ITS OWN SHAREHOLDERS, GIVING ASARCO CYPRUS
SHAREHOLDERS ONLY 43% OWNERSHIP OF THE 3-WAY ENTERPRISE.
Phelps Dodge calls the Asarco Cyprus offer requesting an ownership
interest of just 50% of the value "unreasonable." We disagree, it is
eminently fair.
PHELPS DODGE IS TRYING TO COERCE CYPRUS AMAX AND ASARCO SHAREHOLDERS INTO DOING
A TRANSACTION THAT IS NOT IN YOUR BEST INTERESTS. IT IS UNWILLING TO GIVE YOU
FAIR VALUE. IT IS UNWILLING TO COMMIT TO DOING A TRANSACTION IF SHAREHOLDERS
APPROVE THE ASARCO CYPRUS MERGER ON SEPTEMBER 30. AND IT IS UNWILLING TO PRESENT
YOU WITH A COMPETITIVE DEAL READY FOR COMPLETION.
Compare the certainties of the proposed Asarco Cyprus merger with the
uncertainties of Phelps Dodge's offer:
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
ASARCO CYPRUS PHELPS DODGE
------------- ------------
o September 30 shareholder vote o No Phelps Dodge shareholder vote by September 30
o All regulatory consents obtained o Unknown closing date, if ever
o Fully negotiated and effective merger o Uncertain timing of antitrust clearance
agreement o Exchange offer is subject to numerous conditions
o No form of merger agreement proposed
</TABLE>
- --------------------------------------------------------------------------------
<PAGE>
THE ONLY TRANSACTION CYPRUS AMAX AND ASARCO SHAREHOLDERS CAN COUNT ON TO REALIZE
VALUE IS THE ASARCO CYPRUS MERGER. THE ONLY TRANSACTION CYPRUS AMAX AND ASARCO
SHAREHOLDERS CAN COUNT ON TO BE COMPLETED BY SEPTEMBER 30 IS THE ASARCO CYPRUS
MERGER.
Cyprus Amax and Asarco shareholders need not be stampeded by Phelps Dodge or its
self-serving agenda.
VOTE FOR THE ASARCO CYPRUS MERGER ON SEPTEMBER 30. DESPITE WHAT PHELPS DODGE
WOULD LIKE YOU TO BELIEVE, IT IS THE ONLY TRANSACTION YOU CAN COUNT ON.
To VOTE FOR the Asarco Cyprus merger transaction, please sign and return the
WHITE proxy card.
On behalf of the Boards of Directors and all of us at Cyprus Amax and Asarco, we
thank you for your support.
Sincerely,
<TABLE>
<CAPTION>
<S> <C>
/s/ Francis R. McAllister /s/ Milton H. Ward
Francis R. McAllister, Milton H. Ward,
Chairman and Chief Executive Officer Chairman, Chief Executive Officer and President
ASARCO Incorporated Cyprus Amax Minerals Company
</TABLE>
- --------------------------------------------------------------------------------
- ----------------------------------IMPORTANT-------------------------------------
If you need assistance or information, please call our
proxy solicitors:
Asarco Shareholders Cyprus Amax Shareholders
GEORGESON
MORROW & CO., INC SHAREHOLDER
COMMUNICATIONS INC
at (800) 662-5200 at (800) 223-2064
EXHIBIT 99.17
[ASARCO LOGO] [CYPRUS AMAX MINERALS COMPANY LOGO]
ATTENTION ASARCO AND CYPRUS AMAX SHAREHOLDERS:
THE ASARCO CYPRUS MERGER:
THE ONLY DEAL YOU CAN COUNT ON
TO DELIVER VALUE
The proposed Asarco Cyprus merger is the ONLY transaction that you can count on
to deliver value. It is the ONLY transaction that you can count on to be
completed.
Phelps Dodge wants you to GIVE UP much of what you would realize in an Asarco
Cyprus merger to Phelps Dodge's shareholders through Phelps Dodge's unsolicited
hostile exchange offers. And, PHELPS DODGE CAN'T EVEN ASSURE YOU THAT IT CAN
COMPLETE ITS TRANSACTION.
COMPARE THE CERTAINTIES OF THE PROPOSED ASARCO CYPRUS MERGER WITH THE
UNCERTAINTIES OF PHELPS DODGE:
<TABLE>
<CAPTION>
<S> <C>
ASARCO CYPRUS PHELPS DODGE
o September 30 shareholder vote o No Phelps Dodge shareholder vote by
o All regulatory consents obtained September 30
o Fully negotiated and effective merger o Uncertain timing of antitrust clearance
agreement o Exchange offer subject to numerous conditions
o Unknown closing date, if ever
o No form of merger agreement proposed
</TABLE>
ASK YOURSELF:
1. WHY HAS PHELPS DODGE NOT ACCEPTED ASARCO CYPRUS' TERMS OF AUGUST 25, 1999?
Is it because Phelps Dodge does not want to give Asarco and Cyprus Amax
shareholders a fair ownership interest in the enterprise based upon their
contribution?
2. WHY IS PHELPS DODGE THREATENING TO WALK AWAY IF SHAREHOLDERS VOTE IN FAVOR
OF THE TRANSACTION? Is it because they don't want to pay for your fair
share of the value created by the Asarco Cyprus merger?
3. WHY IS PHELPS DODGE BRINGING LAWSUITS IN NEW JERSEY AND DELAWARE TO PREVENT
SHAREHOLDERS FROM VOTING ON THE ASARCO CYPRUS DEAL? Is it because they are
unprepared to present you with a competitive deal ready for completion?
<PAGE>
ASARCO AND CYPRUS AMAX SHAREHOLDERS NEED NOT BE STAMPEDED
BY PHELPS DODGE'S SELF-SERVING AGENDA.
SHAREHOLDER APPROVAL OF THE ASARCO CYPRUS MERGER ON SEPTEMBER 30 MEANS YOU WILL:
o Receive an immediate cash payment of $5.00 per share
o Be the owners of the largest publicly-traded copper company in the world
with an estimated cash cost of 50 cents per pound
o Benefit from 100% of an estimated $275 million of annual savings achievable
from our combination
VOTE FOR THE PROPOSED ASARCO CYPRUS TRANSACTION ON SEPTEMBER 30
---
DESPITE WHAT PHELPS DODGE WOULD LIKE YOU TO BELIEVE:
IT IS THE ONLY TRANSACTION YOU CAN COUNT ON.
We urge you to sign, date and mail the WHITE proxy card today.
-----
<TABLE>
<CAPTION>
<S> <C>
/s/ Francis R. McAllister /s/ Milton H. Ward
Francis R. McAllister Milton H. Ward
Chairman and Chief Executive Officer Chairman, Chief Executive Officer and
ASARCO Incorporated President
Cyprus Amax Minerals Company
</TABLE>
IMPORTANT
If you need assistance or information, please call our proxy solicitors:
<TABLE>
<CAPTION>
<S> <C>
Asarco Shareholders: Cyprus Amax Shareholders:
MORROW & CO., INC. GEORGESON SHAREHOLDER COMMUNICATIONS INC.
at (800) 662-5200 at (800) 223-2064
or CHRIS SCHULTZ, Treasurer, Asarco or JOHN TARABA, VP and Controller, Cyprus Amax
at (212) 510-2329 at (303) 643-5244
</TABLE>
EXHIBIT 99.18
ASARCO Incorporated [LOGO] CYPRUS AMAX
Minerals Company
[PHOTOGRAPH OF TOQUEPALA] [PHOTOGRAPH OF EL ABRA]
Toquepala El Abra
INVESTOR
PRESENTATION
September 1999
[PHOTOGRAPH OF CUAJONE] [PHOTOGRAPH OF CERRO VERDE]
Cuajone Cerro Verde
<PAGE>
ASARCO CYPRUS MERGER
. Merger of Equals
. Exchange of Shares
- 0.765 Share of Asarco Cyprus for Each Cyprus Amax Share
- 1.000 Share of Asarco Cyprus for Each Asarco Share
. Post Merger Ownership
- Cyprus Amax Common Shareholders Own 63.5%
- Asarco Shareholders Own 36.5%
. Cash Payment of $5.00 Per Asarco Cyprus Share After Closing
. Shareholder Vote September 30
.
.
2
<PAGE>
ASARCO CYPRUS MERGER
. $5.00 Cash Payment to Shareholders on Completion of Merger
- Immediate Value to Shareholders
- Focuses Attention on Underlying Value of Merger
. Drop Takeover Defenses - 90 Days Post Merger
- Disarm Rights Plan
- No Change in Control in New Employment Contracts
. Pursue Sale of Non-Core Businesses - $1 Billion Value Including:
- Specialty Chemical Business
- Kinross Gold
- Australian Coal
. Confident of Achieving $275 Million in Synergies/Rationalization Benefits
.
3
<PAGE>
RE-RATING OF ASARCO CYPRUS
Asarco Cyprus Phelps Dodge
------------- ------------
Market Capitalization* $2.4 Billion $3.5 Billion
Pounds of Production 2.0 Billion 1.6 Billion
Equity Value Per
Pound Produced $1.17 $2.24
- Opportunity For Re-Rating of Asarco Cyprus
- Asarco Cyprus Merger Provides Greater Potential
for Growth in Shareholder Value
* Common Stock Price As of 8/20/99
4
<PAGE>
ASARCO CYPRUS VS. PHELPS DODGE
(Selected Statistics) Asarco Phelps AC share of
Cyprus Dodge AC & PD
------ ------ ------------
1999 (E) Production (Million Lbs.) 2,055 1,551 57%
12/98 Copper Reserves (Billion Lbs.) 62 40 61%
Cash Costs (cents/Lb.) 0.50 0.54 55%
Low Cost Mines 4 1 80%
Copper Margin (@ 80cents)($ Millions) 617 403 60%
Synergies ($ Millions) 275 300 92%
Cash $1.4 B $144 M 91%
5
<PAGE>
Beneficial Copper Production Cash Cost Profile
[Bar graph depicting beneficial copper production cash cost
profile, with figures approximated, for Cyprus Amax: El Abra (cash
cost: 37 cents per pound; copper production: .250 billion pounds),
Cerro Verde (48 cents; .100 billion pounds), Bagdad (67 cents; .225
billion pounds), Miami (68 cents; .190 billion pounds), Sierrita (71
cents; .250 billion pounds); for Asarco: Silver Bell (49 cents; .025
billion pounds), SPCC (51 cents; .500 billion pounds) , MRI (70 cents;
.035 billion pounds), Mission (73 cents; .250 billion pounds), Ray (74
cents; .260 billion pounds); for Phelps Dodge: Candelaria (50 cents;
.325 billion pounds), Morenci (55 cents; .900 billion pounds), Chino
(63 cents; .200 billion pounds), Tyrone (64 cents; .200 billion
pounds). Measured in cash cost (cents per pound) against copper
production (billion pounds).]
Source: Phelps Dodge - Brook Hunt, modified 1999 EST
6
<PAGE>
MERGER COST SAVINGS PROJECTIONS
($ millions, except per share)
Asarco Phelps
Cyprus Dodge
-------- -------
Administration $ 50 $ 85
Purchasing/Operations 50 60
Other 25 55
Rationalization 75 75
-------- -------
Subtotal Cash 200 275
Exploration Adjustment - (40)
-------- -------
Adjusted Cash 200 235
Accounting Benefit 75* 65
-------- -------
Total Pretax 275 300
Contribution 92% 8%
Per Share (after tax) $1.85
Anticipated Market Value Impact ($/Share) $11.33 - $13.76
*Based on Stock Price of $18.00 (AR) at Proxy Date (8/20/99)
7
<PAGE>
COST SAVING ACTIONS
Examples of Cost Savings (In Millions)
Administration $50.0
Consolidate Offices
Eliminate 170 Positions
Eliminate Duplicate Expenses
Eliminate Exploration Duplicate Activities
Purchasing 50.0
Leverage Commodity Purchases
Reduce Warehouse Inventory
Logistics
Operating Best Practices 25.0 +
Haul Truck Load Factor Optimization
Cascade Leaching
In-House Fabrication of Starter Sheets
Converter Maintenance and Scheduling
Minimization of Revert Generation
Crusher Maintenance and Practices
Throughput and Recovery Optimization
Rationalization 75.0
Mine Plan Changes at Mission and Ray
8
<PAGE>
HISTORICAL TRADING VALUES OF SELECTED COPPER EQUITIES
[Chart depicting relative trading values of Cyprus Amax,
ASARCO, and Phelps Dodge, during the period between
January 1 and July 14. Base value assumption: Cyprus - 10.000;
Asarco - 15.125; Phelps - 50.875.]
9
<PAGE>
HISTORICAL TRADING VALUES OF SELECTED COPPER EQUITIES
[Chart depicting relative trading values of Cyprus Amax,
ASARCO, and Phelps Dodge, during the period between
July 14 and August 19. Base value assumption: Cyprus - 13.938;
ASARCO - 19.000; Phelps - 66.438.]
10
<PAGE>
ASARCO CYPRUS REDUCED CASH COSTS
[Bar graph depicting cash costs, measured by cents per pound,
for each of Cyprus Amax and Asarco for 1996 (72 cents for Cyprus Amax,
69 cents for Asarco), 1997 (63 cents for Cyprus Amax, 69 cents for
Asarco), 1998 (56 cents for Cyprus Amax, 64 cents for Asarco), and
1999(E) (50 cents for Cyprus Amax, 60 cents for Asarco), and for Asarco
Cyprus combined for 2001(E) (50 cents).]
11
<PAGE>
ASARCO CYPRUS MERGER
. World's Largest Publicly Traded Copper Company
. Strong Management
. Global Presence With Portfolio of World Class Properties
. Low Costs With Excellent Potential For Additional Reductions
. Accretive to Shareholders
. $875 Million in Cash and $1 Billion Plus in Other Sources of Liquidity
. Pipeline of Growth Projects
. Increased Shareholder Liquidity
12
<PAGE>
ASARCO CYPRUS MERGER
. Asarco Cyprus Merger Creates Greater Value
Opportunity for Shareholders
. Merger Captures Benefits and Provides Immediate Value
. Merger is Best Value for Asarco and Cyprus Shareholders
. Moving Ahead With Merger
. Expect Equity Market to Re-Rate Share Price
13
<PAGE>
ASARCO CYPRUS - WORLD LEADER IN COPPER
- ------------------------------------ ---------------------------------
Contained Copper Reserves - 12/31/98 1998 Copper Beneficial Production
- ------------------------------------ ---------------------------------
[Bar graph depicting, at 12/31/98, [Bar graph depicting 1998 copper
contained copper reserves, measured beneficial production, measured
in billion pounds for CYM & AR (62), in million pounds, for CYM & AR
Rio Tinto (56), BHP Copper (55), (1968), BHP Copper (1929), Rio
FCX (49), Phelps (40), GM (39), Tinto (1792), Phelps (1748), FCX
AR (37), Antofagasta (28), SPC (26), (1479), AR (1025), CYM (965), MIM
CYM (25), Rio Algoim (12), MIM (9).] (784), GM (760), SPC (666),
Antofagasta (563), Rio Algoim
(379).]
Source: Brook Hunt
14
<PAGE>
ASARCO Incorporated [LOGO] CYPRUS AMAX
Minerals Company
Additional Information
<PAGE>
MERGER OBJECTIVES
. Become Low Cost Copper Producer:
$0.50 Per Pound Cash Cost
- Earnings Breakeven: Less Than $0.65 Per Pound Copper Price
- Generate Substantial Cash Flow
. $750 Million EBITDA ($0.80 Copper, $3.00 Molybdenum) After Sale of
Non-Core Businesses
16
<PAGE>
MERGER OBJECTIVES
. $275 Million ($1.85/share) in Annual Synergies, Cost Savings, and
Rationalization Benefits
- Obtain Significant Operating Efficiencies
- Achieve Purchasing Savings
- Reduce Administrative Costs Through Consolidation and Closures
- Employ Best Practices of Two Strong Operators
. Quest 21 / AMS Process Management Systems
- Retain Strongest Managers
17
<PAGE>
MERGER OBJECTIVES
. $275 Million ($1.85/share) in Annual Synergies, Cost Savings, and
Rationalization Benefits
- Cash Cost Savings to Generate $125 Million Annually ($0.84/Share by 2001)
- Benefits of Purchase Accounting to Generate $75 million Annually
($0.50/share)
- Cost Savings of $75 Million From Production Rationalization During Periods
of Low Prices
- Maintain Limited Exploration Program
18
<PAGE>
MERGER OBJECTIVES
. Enhance Liquidity and Financial Flexibility
- Cash of $875 Million After $5.00 Per Share Cash Payment
- Net Debt to Capital of 41.3% (net of cash)
- Sale of Non-Core Businesses - $1 Billion Value
- Net Debt to Capital of 25.5% (net of cash) After Sales
. Realize Immediate Value for Shareholders
- Earnings and Cash Flow Accretive
- Increase Trading Liquidity
- Synergies Should Cause Market Re-Rating of Asarco Cyprus Shares
. Asarco and Cyprus Shareholders Realize 100% of Synergy Benefits
19
<PAGE>
VALUE OF SYNERGIES
.
. Merger Gives Asarco and Cyprus Shareholders 100% of Synergies
.
. Phelps Dodge Proposal Takes 57% of Synergies for Their Shareholders
20
<PAGE>
MERGER OBJECTIVES
. Become the World's Largest Publicly-Traded Copper Company
.
- Highly Focused, High Quality Copper/Moly Producer
- 2 Billion Pounds of Annual Copper Production
- 62 Billion Pounds of Reserves
- World's Largest Molybdenum Producer
- Significant Inventory of Future Development Projects
21
<PAGE>
NORTH AMERICAN OPERATIONS
[Map of United States and more detailed map of Arizona,
indicating locations of mines, smelters, and refineries.]
22
<PAGE>
SOUTH AMERICA OPERATIONS
[Map of South America and more detailed map of Peru and Chile,
indicating locations of mines, smelters, and refineries.]
23
<PAGE>
1998 COMBINED MINE PRODUCTION
In Millions of Lbs.
Sulfide SX-EW Total
------- ----- -----
North America 919 362 1,281
South America 300 387 687
--- --- ---
Total 1,219 749 1,968
24
<PAGE>
ASARCO CYPRUS MANAGEMENT
. Key Cyprus Amax Achievements
- Implemented Quest 21
- Lowered Copper Costs by 21 cents Per Pound
- Reduced Employment at Continuing Operations by 28%
- Increased Production Per Employee by 44%
- Consolidated Moly Operations
- Focused Strategy: Sold Lithium and Coal; Merged Amax Gold
- Successful Development and Startups of El Abra, Cerro Verde
- Reduced Corporate Overhead Expense by 35%
- Transformed from Coal Company to Focused Low Cost Metals Company
25
<PAGE>
ASARCO CYPRUS MANAGEMENT
. Focused Strategy to Realize Shareholder Value
. Key Asarco Achievements
- Expanded Low Cost SX-EW - SPCC, Silver Bell, Ray
- Expanded Low Cost Sulfide - SPCC, Cuajone
- Acquired Controlling Interest in Low Cost SPCC
- Reduced Cash Cost $0.14 per pound
- Assets Disposals of $825 Million
- Implemented AMS Process Management System
- Transformed From Custom Smelter and Refiner to Focused Low Cost Copper and
Specialty Chemicals Company
26
<PAGE>
ASARCO Incorporated [LOGO] CYPRUS AMAX
Minerals Company
Financial Profile
<PAGE>
ASARCO CYPRUS BALANCE SHEET
(In millions)
Pro-Forma Pro-Forma
$5 Cash Payment for Asset Sales
---------------- ----------------
Total Assets $7,624 $7,592
Total Cash and Marketable Securities 878 1,878
Total Debt and Capital Lease Obligations 2,863 2,863
Total Shareholders' Equity 2,262 2,329
Book Value Per Common Share $18.61 $19.22
Total Debt to Capital 50.4% 49.8%
Total Debt to Capital, Net of Cash 41.3% 25.5%
28
<PAGE>
ASARCO CYPRUS NON-COPPER ASSET VALUES
Specialty Chemicals
Cyprus Australia Coal
Kinross Gold (30% Interest)
Grupo Mexico Shares ($79 Million Value)
Other Non-Core Assets
Estimated Value - $1 Billion Plus
29
<PAGE>
ASARCO CYPRUS CAPITAL EXPENDITURES
[Bar graph depicting Asarco Cyprus Capital Expenditures,
in millions of dollars, excluding SPCC, for 1997 (529),
1998(340), 1999(E)(303), 2000(E)(257).]
. Major Projects Completed
. Capital Requirements at Reasonable Levels Going Forward
30
<PAGE>
SOUTHERN PERU CAPITAL EXPENDITURES
[Bar graph depicting Southern Peru Capital Expenditures,
in millions of dollars, for 1997(184), 1998(259),
1999(E)(255), 2000(E)(276).]
. Financing in Place
31
