SPCC sets Min-Mex transfer straight

Lima-based Southern Peru Copper (SPCC, NYSE: PCU) has roundly condemned an article in Peru's República newspaper about the proposed transfer of Grupo Mexico's shares in mining unit Minera Mexico to SPCC. The column contains "a number of false and biased statements" about the proposed deal, currently under consideration by a special third-party commission, the company said in a letter to the paper and copied to Lima's stock exchange. The article erroneously claims that if the transfer goes ahead, the Peruvian state would receive fewer taxes, according to the mining company. SPCC points out that if the deal goes through Minera Mexico would not be transferred to its Peruvian "branch," a separate company that operates under Peruvian laws, but to the Delaware-listed parent company SPCC. "SPCC and the branch are governed by different tax, accounting, societal and labor regimes," the company said in the letter. Grupo Mexico controls SPCC with 54.2%, Cerro Trading Company has 14.2%, Phoenix-based Phelps Dodge has 14.0% and other shareholders 17.6%. SPCC operates the Toquepala and Cuajone copper mines and the Ilo copper smelter-refinery, all in southern Peru. It is one of the world's 10 largest copper producers.