MEXICO CITY -(Dow Jones)- A U.S. court has ruled that Mexican mining company Grupo Mexico SAB (GMEXICO.MX) must pay $1.3 billion to its Southern Copper Corp. (SCCO) unit because Grupo Mexico overvalued a third mining company, Minera Mexico, that it merged with Southern Copper in 2005 when it joined its Peruvian and Mexican mining operations.
Grupo Mexico said Monday it will appeal the ruling by the Delaware court.
A Chancery Court judge said the value of the Minera Mexico unit was inflated when compared to the value of the publicly listed Southern Copper Corp., which at the time was named Southern Peru. Southern Peru paid for Minera Mexico in stock in a transaction that increased Grupo Mexico's stake in Southern Peru.
In its ruling last Friday, the court said Grupo Mexico may satisfy the judgement by returning stock to Southern Copper equivalent in value to the award plus simple interest.
In response to the ruling, Grupo Mexico said it considered that the decision wasn't in accordance with Delaware law or with the evidence presented in the case, and imposed standards that would make such corporate operations impossible to carry out. Grupo Mexico owns more than 80% of Southern Copper.
Grupo Mexico's B shares traded on the Mexican stock market were down 4.4% recently amid a broad market decline.
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