Industrias Peñoles launched unsolicited tender offer in Peru

Industrias Peñoles, S.A. de C.V., a leading Mexican mining, smelting and refining group, launched an unsolicited tender offer through the Lima Stock Exchange to acquire up to 51% of the shares of Compañia Minera Milpo S.A.A., a Peruvian producer of zinc, lead and copper concentrates with operations in Peru and Chile. The offered price was US$6.85 per share in cash, which could total up to US$108 million.

The tender offer was launched on September 28 but failed to attract the minimum requested number of shares.

Luis Carlos Rodrigo P. of Rodrigo, Elias & Medrano Abogados commented: ?Although ultimately unsuccessful, this was the second unsolicited tender offer ever launched in Peru and the first one launched by a foreign company. The hope of Industrias Peñoles was to expand its mining activities in Peru, where it has been prospecting for a decade, and integrate Compañia Minera Milpo?s operations to its increasing portfolio of mining projects in Latin America.?

Industrias Peñoles is listed in the Mexican Stock Exchange and operates the world?s richest silver mine, the fourth largest metallurgical complex in terms of the value of its production, and the largest sodium sulfate plant in the world. It is also the world?s largest producer of refined silver and sodium sulfate. In 2003 its net sales totaled US$1.17 billion.

Compañia Minera Milpo is listed in the Lima Stock Exchange. In 2003 its net sales totaled US$63.8 million.

The team advising Industrias Peñoles and its financial advisor Equitas Partners was comprised of Rodrigo, Elias & Medrano Abogados, through partner Luis Carlos Rodrigo P. and associates Alfonso Montoya and Jose Chiarella, on the design and strategy of the tender offer, and Estudio Rubio, Leguia & Normand, though partners Oscar Arrus and Emil Ruppert, on the tender offer documentation.

Compañia Minera Milpo took counsel from Muñiz, Forsyth, Ramirez, Perez-Taiman & Luna-Victoria through partner César Arbe and associate Ricardo Escobar.