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PLAINTIFFS '! EXHIBITlsIl - -c. ASA-269 Notable Corporate Chronologies Volume 1 A-K Susan B. Martin, Editor 79 ASARCO Inc. Notable Corporate Chronologies 1985 An electronic products development center is established along with AP Technoglass and Belletech in the U.S., Asahi Technovision in Singapore, and Asahi-India Safety Glass. 1986 Annual sales total 836,000,000,000 with net profit of 29,000,000,000. 1987 Jiro Furumoto becomes president and CEO of Asahi Glass. Technological developments open up a range of innovative glass products for the company, prompting Furumoto to design what he calls "AGC Vision 21." This corporate forecast calls for Asahi Glass sales in the year 2000 of 2,400,000,000,000 split evenly be tween glass and nonglass operations. 800,000,000,000 of the total is to come from "new glass" which includes reflective building glass and glass-reinforced concrete, etc. 1988 Asahi Glass founds an advanced glass research and development center. Coming Asahi Video Products Co. (USA) is set up as a joint-venture with Coming, Inc. of the U.S. to participate in operations in North America producing glass bulbs for color television picture tubes. 1989 Total net sales exceed 1,000,000,000,000 for the first time with a net profit of 59,000,000,000. 1990 Tenneco Soda Ash Joint Venture (now re named Solvay Soda Ash Joint Venture) is established with Tenneco Minerals Co. in the U.S. 1991 Asahi Glass participates in Splintex (Belgium) and establishes ACT Tech (U.K.) Ltd. to begin the automotive glass business in Europe. An alliance with PPG Industries is formed to develop a flat glass business in China. The company makes an equity participation in Dastek and enters the thin film magnetic head business. Annual sales remain stable at about 1,020,,000,000,000. 1992 The company's profits for the first two quarters of its fiscal year are down 19% to 64,000,000,000. 1993 With products that touch almost every aspect of daily life, Asahi Glass Co. is a leading manufacturer of glass, chemicals, and electron ics in Japan and the Far East with ever expanding markets globally, including 29 affili ates in 11 foreign countries that employ ap proximately 16,000 workers. Further Reading: AGC Company Guide. Asahi Glass Co., Ltd., 07-92. American Banker. 09-20-90; 11-13-90; 12-14-92. 130 International Directory of Company Histories. De troit: St. James Press. "The process of internationalization; Asahi Glass Company, Ltd." Tokyo Institute of Comparative Culture Business Series 99, 1985. Kinhisa, Mushakoji. Business Journal of Upper East Tennessee and Southwest Virginia, July, 1992. Mitsubishi and the N. Y.K., 1870-1914: Business Strat egy in the Japanese Shipping Industry. Cambridge; Harvard UP, 1984. The Wall Street Journal: 02-24-93. 79 ASARCO 180 Maiden Ln. New York NY 10038 U.S.A. Inc. PH:(212)510-2000 FX:(212)510-2271 1899 Henry H. Rogers, along with William Rockefel ler and the copper-rich Lewisohn brothers, Adolph and Leonard create the American Smelting and Refining Company (ASARCO) consisting of 23 different smelting companies. 1901 ASARCO merges with the Guggenheim fami ly's metal empire, with Daniel Guggenheim becoming chairman and president. 1903 The company gains control of the stock of the United States Zinc Company, contracts with the National Lead Company for the sale of its lead requirements, and buys the rights from the Federal Mining and Smelting Company to all silver-lead ores mined from its Coeur d'Alene, ID properties. 1905 The American Smelters Securities (ASSC) is organized as a public company, but is con trolled by the directors at ASARCO. 1915 The company moves into zinc refining with the construction of the Amarillo, TX smelter. 1916 Operations begin in Chile with the purchase of the Caldera Smelter. Also this year, farmers in California and Utah file lawsuits against AS ARCO charging crop damage from sulfur diox ide, a chemical that is released when zinc, lead, and copper ores are processed. 1922 The company enters a period of turmoil when allegations are made that the Guggenheims are diverting ASARCO funds for their non-ASARCO family business interests. Although stock holders officially clear the family of any wrong doing, this year markets the end of the Guggen heim's overpowering control. Gale Research Inc. Notable Corporate Chronologies 80 Aula Croup Pic 1923 A rod and wire plant is built at the company' Baltimore refinery. 1928 The Revere Copper and Brass Company is formed. 1932 ASARCO continues to expand, purchasing the Federated Metals Corporation. 1945 Following WW II, secondary products become increasingly important for the company, with ASARCO becoming a market leader in seleni um, a leading supplier of cadium, and a suppli er of germanium. 1948 Full rights are obtained to the rich copper property of Toquepala in southern Peru. 1952 Diversification continues as the company en ters the asbestos field at Black Lake in Quebec. 1955 The company forms an arrangement with Phelps Dodge, Cerro de Pasco Corp., and Newmont Mining to create the Southern Peru Copper Corporation. 1958 Kennecott Copper Corp., a huge source of copper for ASARCO's smelters for over 50 years, ends its contract, finally buying the company's Garfield smelter the following year. 1959 The longest copper strike in history keeps the company's 13 U.S. smelters and refineries shut down for 113 production days. 1965 With profits from the Mexican operations drying up, the mines and plants are reorganized as ASARCO Mexicana, S.A. 1971 The American Limestone Co. along with four zinc mines in Tennessee join ASARCO's hold ings. 1975 American Smelting and Refining Co. officially changes its name to ASARCO, and the obsolete copper-refining plants in Baltimore and Perth Amboy, NJ are replaced by the new facility in Amarillo, TX. 1978 Over the last four years, the company's growth has been impeded by labor problems and market fluctuations, resulting in a loan from nine banks for over $200 million. 1979 Construction begins on the Troy silver mine in Montana. 1984 With copper prices dropping caused in part by the flooding of the market, ASARCO reports a loss of $306 million. 1985 With antipollution regulations and the contro versy over the Tacoma copper smelter's arsenic emissions, the facility closes this year because the costs to adapt the smelter to meet emissions standards is considered too high. Gale Research Inc. 1987 Having laid off several level of managers, renegotiated wages and transportation con tracts, and cut pension costs, the company is again making money by the end of the year. 1988 OMI International Corp. is acquired. 1989 The purchase of the IMASA Group this year helps establish ASARCO as a major force in specialty chemicals, metal finishing, and elec tronics. Also this year, a 49.9% stake in the copper mining business of Montana Resources, Inc., is acquired. 1991 ASARCO along with two of its subsidiaries are defendants in over 800 lawsuits alleging dealth or injury caused by asbestos and 15 lawsuits related to asbestos in buildings. 1992 Expansion is completed at the Mission and Ray mines in Arizona, and the company has be come self sufficient in the supply of copper concentrates to its smelters. 1993 Plans are underway to expand and modernize the El Paso facility; the Troy, MT silver-copper mine is shut down temporarily. Further Reading: ASARCO: 1992 Annual Report. ASARCO: The Metal Maker. New York: ASARCO, Inc., 1981. Hoover's Handbook of American Business 1993. The Reference Press. International Directory of Company Histories. De troit: St. James Press. 80 Asda Group Asda House Southbank Leeds LS11 5AD England Pic PH:532 435435 FX:532 418666 TLX:556623 1920 J.W. Hindell and a group of fellow dairy farmers in northern England form a partner ship, Hindell's Dairy Farmers Ltd., and estab lish wholesale and retail milk outlets to com pete against lower quality European imports. 1949 March - The partnership becomes a public company named Associated Dairies and Farm Stores Ltd. It maintains 26 farms, three dairies, and 42 retail shops. 1965 Associated Dairies forms a subsidiary, Asda Stores Ltd., with the purpose of opening large 131 VOLUME George A. Peters and Barbara J. Peters 162 Sourcebook on Asbestos Diseases, Volume 2 1891, in Pennsylvania. On January 14, 1895, the company changed its name to Armstrong Cork Co. More recently, it changed its name to Armstrong World Industries, Inc. In 1951, Armstrong Cork purchased Asbestos Supply Co. In 1958, the company formed Armstrong Contracting and Supply Corporation to handle its contract insulating business. Later, the contracting business was sold to North Lime Cor poration. In 1962 and 1963, the company established a Con sumer Product Division and an Industry Products Division. ASARCO The company was incorporated in New Jersey on April 4, 1899, as the American Smelting & Refining Co., now known as ASARCO Incorporated ("Asarco"). Asarco is a mining company but has never been involved in mining, processing, distributing, manufacturing, or selling asbestos or asbestoscontaining products. Its primary products are copper, lead, silver, and zinc. In September 1974, the company became the sole owner of Cement Asbestos Products Co., now known as Capco Pipe Company, Inc. ("Capco"), a corporation that manufactures asbestos-cement pipe. This company operates as a subsidiary of Asarco and has one asbestos-cement pipe plant. The asbes tos-cement pipe is used only in underground applications. Asarco owns Lac d'Amiante du Quebec Ltee. ("LAQ"), a Delaware corporation. Its principal place of business is Post Office Box 608, Black Lake, Quebec, Canada GON 1A0. LAQ has been in the business of mining, milling, and selling raw asbestos fiber. It has never manufactured any asbestos-con taining products. LAQ had been engaged in a joint venture to mine asbestos with United Asbestos Inc., a Canadian corpo ration. LAQ has no offices in the United States. LAQ had been.named in 186 lawsuits by approximately 461 plaintiffs, in both the state and federal courts, who allege exposure to its asbestos in factory worker cases. In 1981, the company completed or reached settlements for approxi mately $3,754,000 in what has been, by far, the largest yearly total for settlements by LAQ. Asarco, LAQ, and Capco are totally separate corpora tions. Asarco seeks and has obtained dismissals in lawsuits in which it has been alleged that LAQ's fiber was defective because of the absence of a warning. Asarco believes it should not be named in any asbestos-related lawsuits. International Directory 0 COMPANY HISTORIES ASARCO ASARCO INCORPORATED 180 Maiden Lane New York, New York 10038 U.S.A. (212) 510-2000 Fax: (212) 510-1835 Public Company Incorporated: 1899 as American Smelting and Refining Company Employees: 9,300 Sales: $2.21 billion Stock Exchange: New York ASARCO Incorporated is a world leader in the production of nonferrous metals, including copper, lead, zinc, silver, and gold. Among the mines operated by ASARCO or its associ ated companies are the Mission and Ray open-pit copper mines in Arizona; the Silver Bell Mine in Arizona; the Conti nental Mine in Montana; four zinc mines near Knoxville, Ten nessee; the West Fork and Sweetwater lead mines in Missouri; the zinc, lead, silver, and gold mine at Leadville in Colorado; die Toy silver-copper mine in Montana; and two silver mines in Idflhn, nl Cinlrnn nnil Cncur PnTJin(! fneilitirs iiprrntril by ASARCO include copper smelters in Hayden, Arizona, and El ftiso, Texas; a copper refinery in Amarillo, Texas; a lead smelter in East Helena, Montana; and a lead refinery in Omaha, Nebraska. In 1990 ASARCO and its associated companies in Austra lia, Mexico, and Peru accounted for 12% of free-world mine production of copper, 14% of silver, 14% of lead, and 9% of zinc. Through its subsidiaries, ASARCO is heavily involved in the manufacture of specialty chemicals for electroplating, metal finishing, and electronics applications. In addition to processing the products of its own mines, ASARCO acquires ore from other companies, either to process for a fee or to process and then sell on the open market. Consumers encoun ter these refined metals in many forms, including zinc in the form of flashlight batteries, copper in the form of car radia tors, lead in the form of automotive batteries, and silver in the form of coatings on photographic film. ASARCO has entered into hazardous-waste recycling as well. Founded in 1899 as American Smelting and Refining Company--known informally as ASARCO--the company was a giant from the start. Henry H. Rogers was a 19th-century financial baron who had collaborated with John D. Rockefeller Mining A Metals: ASARCO INCORPORATED 31 in constructing the huge Standard Oil Trust. ASARCO was his attempt to similarly dominate die nonferrous metals industry. In that eta of corporate consolidation and combination, the smelting and refining business seemed to be a perfect candi date for monopolization. Rogers--along with William Rocke feller and the copper-rich Lewisohn brothers. Adolph and Leonard--had formed the United Metals Selling Company in the 1890s. This trust was so successful that they launched the even larger American Smelting and Refining Company in 1899. At its creation ASARCO consisted of 23 different smelt ing companies. Conspicuously absent from the ASARCO ros ter were concerns controlled by the Guggenheim family In 1899, Rogers invited the Guggenheims to become part of ASARCO. They turned down his offer. The Guggenheims were not interested in being part of an organization that was not under their family control. Over the next couple of years, the Guggenheims took the matter into their own hands and gained control of ASARCO through aggressive business tactics. Meyer Guggenheim, the patriarch of the family, had emmigrated from Switzerland in 1848. He amassed his fortune through an extremely diverse variety of business ventures, from manufacturing and peddling stove polish, to wholesale spite Miles, to importing flue laces and embroideries fly 1879, at the age of 51, Meyer Guggenheim was nearly a mil lionaire. His entrance into the metals industry came in 1881. when he bought a one-third interest in the A. Y. and the Minnie lead and silver mines in Leadville, Colorado. By 1888 these two mines were making about $750,000 a year, and the Gug genheim metal empire had been born. Meyer Guggenheim soon determined that more profits were being taken in by the middlemen of the industry--the smelters--than by the miners. He bought a controlling interest in the Holden Smelter in Denver, Colorado, where his ore was refined, started the Philadelphia Smelting and Refining Com pany. and began building a new smelter at Pueblo, Colorado. Next he consolidated the various businesses, including his share of Philadelphia Smelting, under the firm M. Guggen heim's Sons, which until then was just a lace importing firm. Hr 'Irlrptitr'l vnrinus ilulirt nmmig In-, irvrn Mine Thr Purlilu smelter at fust was a financial disaster. The Guggenheims's inexperience in the industry and the mine workers' strikes against the 12-hour day brought the company to the brink of ruin. It was saved, in part, by the Sherman Silver Purchase Act, passed by Congress in 1890, as a consequence of which the U.S. Treasury Department agreed to buy four million ounces of silver every month, producing a sharp rise in silver prices. By 1890 the Guggenheims had for some time imported lead and silver ores from Mexico for their Pueblo smelter. The McKinley Tkriff Act of 1890. would have made this a more expensive activity. The Guggenheims, however, built two smelters in Mexico, thereby taking advantage of cheap Mexi can labor and avoiding the tariff. By 1895, the Guggenheims were reaping over $1 million a year from their smelters at Pueblo. Monterrrv. .ir*H Ajm-isralirntrs, nrvl were one nf Mrs ico's greatest industrial powers. This was the healthy state of the Guggenheim enterprise at the time Rogers was assembling American Smelting and Refining Company. In 1900 ASARCO was hit with two months of worker strikes and Daniel Guggenheim increased production at his family's operations, flooding the market with cheap lead and silver and 32 Mining Metals: ASARCO INCORPORATED driving prices downward. He also lured mine owners through out the West into selling their ore to the more stable Guggeabeims. As ASARCO stock fell in price, Daniel Guggenheim bought it up. ASARCO officials, now worried, tried again to buy out the Guggenheims. A deal was negotiated: Guggen heim properties and working capital in exchange for $45.2 million in ASARCO stock, a controlling interest, and board positions for the Guggenheim brothers. In April 1901, the merger was completed. Daniel Guggenheim became chairman of the board and president of ASARCO; Solomon Guggen heim became treasurer; Isaac. Murry, and Simon Guggen heim, members of the board. ASARCO would be headed by a member of the Guggenheim family until 1957, when Roger Straus, son-in-law of Daniel Guggenheim, retired. The first decade of the 20th century was 9 time of great growth and diversification for ASARCO under Daniel Gug genheim's leadership. By 1903 ASARCO had acquired stock control of the United Stales Zinc Company, contracted with the National Lead Company for the sale of its lead require ments, and purchased rights from the Federal Mining and Smelting Company to all silver-lead ores mined from its Coeur d'Alene, Idaho, properties. In 1905 the American Smelters Securities Company (ASSC) was organized. ASSC was a public company but was con trolled by the officers and directors of American Smelting and Refining Company. Since expansion further into mining would rout much more than ASARCO possessed in cash resources, ASSC ottered securities guaranteed by ASARCO in order to finance new and expensive projects. The officers were essen tially the same as those of ASARCO, and the floating of these securities made several purchases possible, including a Ta coma, Washington, lead and copper smelter; the Selby lead smelter and refinery at San Francisco, California; and a Balti more, Maryland, copper refinery. The securities also paid for construction of a new copper refinery at Tacoma and a huge copper smelter at Garfield, Utah. Five mines in Mexico were purchased as well, plus the Flat River mines of the Federal Lead Company. Expansion and acquisition continued during the years prior to World War I. The building of the Amarillo, Texas, smelter in 1915 marked the company's plunge into zinc refining. In 1916, ASARCO began operating in Chile, with the purchase of the Caldera Smelter. This era of continued growth pro gressed in spile of obstacles. Mine owners in Colorado, be lieving that smelters were charging excessive rates for processing ores, attempted to pass a bill through the state leg islature making smelters public utilities under control of the state. This action foiled. Farmers in California and Utah filed lawsuits against ASARCO charging crop damage from sulfur dioxide, a chemical released when zinc, lead, and copper ores are processed. This issue was neutralized somewhat by the creation of an ASARCO research division to address environ mental concerns. The outbreak of World War I created a huge need for metals, including copper, zinc, and lead. ASARCO benefited even be fore the United States entered the war, since Europe was largely dependent on the United States for its copper supply. Between 1914 and the U.S. entry into the war in 1917, U.S. copper production had nearly doubled, and copper prices had nearly tripled before government price limits were initiated. Once the war ended, there was a backlash. Mines were urged to continue producing in order to avoid unemployment and recession. Demand for copper products was down, yet American Smelting and Refining Company was still under contract to buy huge amounts of copper. Mining and smelting companies found it necessary to borrow millions of dollars to cover their growing inventories, and in 1920 ASARCO found itself $12 million in debt to various banks. In 1919 Daniel Guggenheim resigned as president of Ameri can Smelting and Refining Company, and Murry and Solomon Guggenheim gave up their board positions. Simon Guggen heim assumed the leadership of the company. This was a pe riod of some turmoil at ASARCO. Karl Eilers, son of Anton Eilers, a member of Henry Rogers's original ASARCO combi nation, attacked foe way ASARCO was being managed, and sought Simon Guggenheim's resignation as president. At the annual stockholders meeting of 1921, Eilers unsuccessfully attempted to have a slate of directors elected that was outside of foe Guggenheim influence. Allegations were made that foe Guggenheims were diverting ASARCO funds for their nonASARCO family business interests. These suspicions were fueled in part by foe existence of a secret stairway used by Daniel Guggenheim that connected his ASARCO office with his Guggenheim Brothers office a floor below in foe same building. Although a committee of stockholders officially cleared foe family of any wrongdoing, 1922 marked the end of the Guggenheims's overpowering control of ASARCO, al though they were still well represented. During foe 1920s, foe direction of ASARCO's growth was toward fabrication of products made of the metals it produced. In 1923 a rod and wire plant was built at foe company's Balti more refinery. The rod and wire business was soon combined with several other wire and cable companies to form the Gen eral Cable Company, which began operating in 1927, with ASARCO holding about an 11% interest. ASARCO would later increase its share considerably. In 1928, ASARCO en tered a similar arrangement with its Baltimore copper and brass rolling mill. In that year, Revere Copper and Brass Com pany was formed, with ASARCO holding a 19% share, a per centage also destined to grow. By 1929 American Smelting and Refining Company was the largest refiner of nonfeirous metals in the world, but it was not unharmed by foe Great Depression. After earning a net in come of nearly $22 million In 1929, ASAKCO's business de clined, resulting in a $4.5 million deficit in 1932. In spite of foe hard times, ASARCO continued to expand, purchasing the Federated Metals Corporation, a huge source of scrap metal, in 1932. The company's recovery was aided by President Franklin D. Roosevelt's silver-purchase plan and his devalua tion of foe dollar, which caused the prices of precious metals to rise. During foe 1930s ASARCO introduced two innovative methods of inventory accounting, foe "last in, first out" sys tem in 1935, and foe "normal" system in 1939. These systems addressed foe question of whether money was actually being made from smelting and selling or on mere speculation of future metal prices. Both of these systems tended to reduce the effects of profits resulting from price fluctuations by setting the value of excess metal stock lower than the price was ex pected ever lo drop. ASARCO's involvement with the mine at Mount Isa in Aus tralia began in the 1930s. Mourn Isa began as a lead and silver mining effort by an English group, the Mining Trust Ltd. In 1930 the trust needed money, and ASARCO invested a small sum. After numerous mining catastrophes, money shortages, and subsequent bailouts by ASARCO, by 1934 the investment amounted to more than $8 million. Mount Isa made its first profit in 1937. Shortly after that, copper was discovered there, boding well for Australia's soon-to-come war needs. During World lAfar II the mine was used to supply copper, but it was not until 20 years later that it was known to be a phenomenal copper strike. The effects of World War n on ASARCO were not as great as those of World War I. Because mines in Canada, South America, and South Africa had been developed, Europe's reli ance on U.S. copper was not as great. The price of copper did not rise, therefore, until 1941, when die United States entered the war and needed its own supply. Then the government put ceilings on prices at die levels that existed. These ceilings lasted until 1946. The government also adopted a premium price plan, under which each mine that produced copper, lead, or zinc was paid enough to earn it a fixed profit. This way, the necessary amounts of metal were produced, and mines were not stuck with huge excesses when the war ended. Simon Guggenheim died in I'M I. A Her hi* denth, American Smelting and Refining Company's by-laws changed so that the chairman of the board, rather than the president, was the chief executive officer. Francis H. Brownell, already chairman, was thus in charge until 1947, when Roger Straus, son-in-law of Daniel Guggenheim, took over. After World War II, secondary products became increas ingly important for ASARCO. Often eight or nine different metals are found in tiny amounts from a single charge of ore, and ASARCO took advantage of this diversity as much as pos sible. Tha company became a market leader in selenium, used in electronic parts; a leading supplier of cadmium, used for metal plating; and a supplier of germanium, used in transis tors. Its Garfield, Utah, copper smelter began to produce more sulfuric acid than copper. ASARCO recovered bismuth and antimony from lead refining, indium from zinc smelting, and arsenic and tellurium from copper processing. By the 1930s it became clear that ASARCO's future expan sion needed to focus on mining. As large mining companies began to do their own smelting, ASARCO adjusted by seeking to become its own best customer, assuring a steady source of raw ores. ASARCO had obtained full rights to the rich copper property of Tbquepala in southern Peru in 1948. By the mid1950s the company had teamed with Phelps Dodge, Cerro de Pasco Corporation, and Newmont Mining to form the South ern Peru Copper Corporation, with ASARCO controlling a 37% share. Southern Peru borrowed $120 million from the Export-Import Bank to develop an open-pit mine at Tbquepala, and the mine was still productive in 1990. In 1952, ASARCO further diversified by entering the asbes tos field at Black Lake in Quebec. The 1930s were not particu larly profitable for ASARCO. Income from the Mexican properties, which were crucial to the company's survival through the Depression, was cut into by an Increase in the export duty and devaluation of the peso in 1954. Lead and zinc prices declined around this time as well. Kenneth Brownell, chairman since Roger Straus's retirement a year earlier, died in Mining & Mettds: ASARCO INCORPORATED 33 1958, and John D. MacKenzie took over as chief executive. The same year, the Kennecott Copper Corporation, a huge source of copper for ASARCO's smelters for over 50 years, ended its contract, and finally bought ASARCO's Garfield smelter in 1939. The year 1939 also brought the longest cop per strike in history, which kept ASARCO's 13 U.S. smelters and refineries shut down for 113 production days. American Smelting and Refining Company entered the IVOOtt kill! the wuild'k leading tualnni tinellcr. A* lead and zinc prices continued to decline, the company's emphasis was turned toward copper mining. With the Mount Isa and Toquepala properties beginning to pay off well and the addition of the Mission copper mine in Arizona, ASARCO was the fourth-largest copper producer by 1963, behind Kennecott, Anaconda, and Phelps Dodge. Under MacKenzie, efforts were made to cut costs, including a 20% decrease in payroll, and more importantly, the use of inexpensive strip mining tech niques at the Rsni mines. At the time Edward Tittman as sumed die chairmanship in 1963, ASARCO was continuing to integrate downward into mining while many of its major cus tomers integrated upward into ore processing. Secondary metals remained important, with the construction of a plant to process molybdenum, a copper by-product, at the Mission site in 1964. In 1965, with profits from the Mexican operations drying up, ihe Mexican itiinra and planlx wrrr rrorgani/rd ax ASARCO Mexicans, S.A., and a majority interest was sold to Mexican investors. The San Xavier North mine adjacent to Mission began operating in 1967. By the early 1970s copper was accounting for nearly twothirds of ASARCO's earnings. The company remained active in other areas as well, purchasing the American Limestone Company and four zinc mines in Tennessee in 1971. ASARCO continued to expand in copper production under chairman Charles Barber, opening the Sacaton copper mine in Arizona in 1974. In 1975 American Smelting and Refining Company officially changed its name to ASARCO, and the obsolete copper-refining plants in Baltimore and Perth Amboy, New Jersey, were replaced by the new facility in Amarillo, Tbxas. During the period from 1974 to 1978, ASARCO's growth wax impeded by labor problems and market fluctuations. Wall Street observers voiced concern that the Peruvian government might expropriate ASARCO's properties there, expropriation having been a problem for Anaconda and Kennecott in Chile. Between 1977 and 1978 ASARCO borrowed more than $200 million from nine banks, including Chase Manhattan, where Charles Barber was a director. Throughout the 1970s antipollution regulations caused prob lems for ASARCO. The copper smelter in Thcoma was a long standing source of controversy over its arsenic emissions. Compliance with Environmental Protection Agency regula tions was difficult both because of the plant's age and the fact that ASARCO was producing arsenic there as a commercial by-product. The Ibcoma smelter was finally closed in 1985, after many variances from compliance, because adapting the smelter to meet emissions standards was considered too costly. ASARCO recovered somewhat in 1979. Construction began on the Itoy silver mine In Montana that year. The lilkcnhowcr Mining Company, a partnership of ASARCO and the Anamax Mining Company, began to gain benefits from the Palo Verde copper deposit near the Mission mine. 34 Mining A Metals: ASARCO INCORPORATED The early 1980s were not good years for the mining indus try. The price of copper was dropping although demand was up, caused in part by the flooding of the copper market by ute-owned companies, particularly in Chile. In 1984 ASARCO lost >JOO million. Chairman Ralph Hcimcbccirs only recourse was to cut costs. In 1985, with ASARCO losing $20 million a quarter, Hennebach retired. Richard de I. Os borne, then chief financial officer, became CEO and chairman of the board. Osborne laid off several layers of managers, re negotiated wages and transportation contracts, and cut pension costs. Between 1981 and 1985 annual expenses were cut fay more than $200 million. While other companies were selling off assets, ASARCO used its newly replenished cash flow to buy new min** and reserves, such as Kennecoa's Ray copper mine, to assure business for its smelters. By the end of 1987 ASARCO was making money again. Through the late 1980s ASARCO continued to diversify. The company's acquisition of OMI International Corporation in 1988 and the Imasa Group in 1989 helped establish it as a major force in specialty chemicals, metal finishing, and elec tronics. Uy 19H9 ASARCO was on duck toward ilk goal of becoming a fully integrated, self-sufficient producer of copper and lead. With the 1989 purchase of 49.9% of the Montana copper mining business of Montana Resources, Inc. and the expansion of capacity at the Mission and Ray mines, it was estimated that ASARCO would be able to supply the entire capacity of its own copper-smelting facilities fay 1992. Since its creation just before the turn of the century, ASARCO has survived by adapting. In an industry at the mcicy of both historical and geological three*, the company has managed to adjust during every cycle, often fay going against the tide of the rest of the industry. If it is able to adapt to the greater environmental and higher technological needs of the metal industry's future, ASARCO's prospects remain good. Principal Subsidiaries: Enthone-OMI, Inc.; Imasa Group; Southern Pent Copper Corporation (52%); Mexico Desarrollo Industrial Minero, S.A. de C.V. (34%); M.I.M. Holdings Limited (Australia, 19%); Asarco Australia Ltd. (60%). Further Reading: Marcosson, Isaac, Metal Magic, New Mark, Farrar, Straus and Company, 1949; "Asarco Bids to be a Giant in Mining," Business Hkek, November 24, 1956; McDonald, John, "The Big New Kicker at Asarco," Fortune, January 196J; Davis, John, 'the Guggenheim, New York, William Morrow and Company, 1978; Asarco: The Metal Maker, New York, ASARCO Incorporated, 1981. --Robert R. Jacobson ASARCO Page 1 of3 er Rgpflrta ASARCO Corporate History 1899 1901 1903 1905 1909 1910 1915 1921 1922 1930 1932 1942 1954 1955 1957 1958 1960 1961 1965 1968 1970 1971 1973 1974 Asarco organized as American Smelting and Refining Company. Included in original consolidation were mines and mining claims in Colorado and Mexico. Major plants in consolidation included: Globe by-products plant (Denver, Colorado), Omaha lead refinery (Nebraska), East Helena lead smelter (Montana), El Paso lead plant (Texas). Merged with M. Guggenheim's Sons. Included in the merger were the Perth Amboy copper refinery (New Jersey) and smelters in Mexico. Acquired five additional mines in Mexico. Purchased control ofFederal Mining and Smelting Company, which owned mining properties in Idaho. Tacoma, Washington, smelter purchased. Baltimore, Maryland, copper refinery purchased. Purchased mining properties in Silver Bell district of Arizona. Copper smelters built in El Paso, Texas, and Hayden, Arizona. Copper refinery added to Tacoma plant. Acquisition and start-up at Quiruvilca mine in Peru. Amarillo, Texas, zinc plant constructed. Initial investment made in Australia's Mount Isa Mines Limited. Federated Metals Corporation purchased. Corpus Christi, Texas, zinc plant constructed. Production commenced at Silver Bell, Asarco's first open-pit copper mine. Galena silver mine in Idaho started production. Enthone Incorporated acquired. Lake Asbestos of Quebec, Ltd., began operations. Southern Peru Copper Corporation opened the Toquepala mine and Ilo smelter. Mission copper mine in Arizona started up. Mexican mines and plants reorganized as Asarco Mexicana, S.A., and 51% interest sold to Mexican investors. Glover, Missouri, lead smelter-refinery started up. Midland Coal Cornpany division formed from four purchased Illinois mines. Mount Isa Mines Limited reorganized as a holding company to be known as M.I.M. Holdings Limited. Selby, California, lead plant closed. Leadville mine in Colorado began mining lead-zinc ore. Four Tennessee zinc mines purchased. American Limestone Company of Knoxville, Tennessee, acquired. Purchased zinc oxide plants at Hillsboro, Illinois, and Columbus, Ohio. San Xavier copper mine and leach plant in Arizona started production. Acquired National Asbestos mine, Quebec, Canada. Copper mining began at Sacaton open pit in Arizona. Asarco Mexicana, S.A. reorganized as Industrial Minera Mexico, S.A and 15% interest sold to Mexican investors reducing equity to 34%. http ://www. asarco. com/Other/stats_ch.html 10/13/98 ASARCO 1975 1976 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 Page 2 of3 Corporate name changed to ASARCO Incorporated. Amarillo zinc refinery closed. Amarillo copper refinery commenced production. Baltimore copper refinery closed. Perth Amboy copper refinery closed. Coeur silver mine in Idaho started production. Southern Peru Copper Corporation opened Cuajone copper mine. Industrial Minera Mexico, S.A. (IMM) reorganized. Asarco owns 34% of Mexico Desarrollo Industrial Minero, S.A., a holding company formed to hold shares of IMM and shares of certain IMM operating subsidiaries. Modernization of El Paso Plant completed. Eisenhower Mining Company, a partnership of Anamax and Asarco, began mining the Palo Verde copper deposit located between Asarco's Mission and San Xavier copper mines. Construction ofWest Fork, Missouri, lead mine commenced. Copper refinery at Tacoma, Washington closed. Troy silver-copper mine started productioa Modernization of Hayden copper smelter commenced. Asarco interest in Revere Copper and Brass Incorporated sold. Hayden copper smelter modernization completed. Sacaton copper mine in Arizona closed. Corpus Christi zinc smelter and refinery operations suspended indefinitely. Tacoma copper smelter closed. Pima copper mine in Arizona acquired. West Fork lead mine started up; limited production. Ray copper mine and smelter purchased. Ozark Lead Company's Missouri assets acquired, renamed Sweetwater Unit. Anamax interest in Eisenhower mineral reserves acquired. Wiluna gold mine in Australia started up. (Production from leaching of waste dumps begun in 1986.) Sold 155.6 million ordinary shares of M.I.M. Holdings Limited, reducing ownership to 19% from 34.9%. Sweetwater mine put in limited production. West Fork lead mine expansion to full capacity commenced. OMI International acquired. Encycle, Inc. started up waste treatment facility at Corpus Christi. IMASA Group acquired. 49.9% interest acquired in copper mining business of Montana Resources, Inc. Asarco's subsidiary Lac d'Amiante du Quebec Ltee (LAQ) ends its investment in asbestos mining with the sale of interest in an asbestos mining limited partnership. Asarco announces decision to end involvement in coal mining. Asarco announces board approval to expand copper facilities at Mission and Ray mines and El Paso smelter. Investment for copper expansion program slated for Mission, Ray and Silver Bell mines and El Paso smelter to be in excess of $400 million. Asarco Australia acquires foil interest in Wiluna gold mine. http ://www. asarco. com/Other/stats_ch.html 10/13/98 ASARCO Page 3 of3 1991 1992 1993 1994 1995 1996 1997 Expansion ofMission mine completed. Expansion of Ray mine completed. Asarco becomes a fully integrated copper producer. Asarco implements new organizational structure consisting of Copper Operations, including all copper mines and plants; and the Lead, Zinc, Silver and Mineral Operations, consisting of all lead, zinc, silver and mineral mines, plants and units. Modernization of El Paso smelter completed. Acquisition by Southern Peru Copper Corporation ofIlo Refinery. Asarco acquires right to mine Russian gold deposit in Kamchatka. Capco's PVC pipe business sold. Underground operation at Mission mine announced. Asarco and Coeur d'Alene Corp. form Silver Valley Resources, Inc. Asarco purchases an additional 10.7% interest in SPCC, increasing holdings to 63%; consolidates results. Asarco sells Nor Peru interest to Pan American Silver. SPCC starts SX/EW facility at Toquepala. New sulfuric acid plant started at SPCCs Ilo smelter. Asarco announces plans to end lead refining at Omaha plant. Asarco announces construction of a new mining and SX/EW facility at Silver Bell mine. Asarco announces sale of shares of M.I.M. Holdings Limited for US$331.2 million. Asarco announces joint venture to develop Minto copper mine. Silver Bell solvent extraction/electrowinning facility started. Asarco sells shares in Grupo Mexico, S.A. de C.V. for $323 million. Expansion program started at SPCC's Cuajone mine; to increase mine's production 50%. Return to Top Statistical Data Home Page ASARCO Home Page http://www.asarco.com/Other/stats_ch.html 10/13/98 ,, ASARCO Page 1 of2 ar Reports ASARCO Financial History 1899 1901 1923 1937 1940 1963 1968 1971 1973 1975 1976 1978 1979 1981 1982 1983 1985 1986 Asarco founded April 4 by a group headed by H.H. Rogers and Leonard Lewisohn. Initial capitalization, $56.9 millioa $27.4 million in common stock, $27.4 million in 7% Preferred Stock, $2.1 million in mortgages on properties acquired. Asarco in difficult conditioa M. Guggenheim's Sons invested $45.2 million and assumed effective control. Capitalization increased to $50 million in common stock, $50 million in 7% Preferred Stock. $10 million Series B First Mortgage Bonds sold, raising debt to $51.3 million (28.5% of capital), a ratio not exceeded until 1970s. Public stock offering to stockholders. Sold 366,000 shares at $70 per share, entitling stockholders to purchase one share for each five shares held, in cash. All debt retired. No further debt outstanding until 1963 (except for $ 13 million in bank loans at the end of 1958 which was repaid January 1959). $40.9 million of debt incurred by exchange of 4 5/8% Subordinated Debentures and cash for 7% Preferred Stock outstanding since the Company was founded. Adopted equity accounting for associated companies. $28.4 million in short-term bank loans incurred. Acquired American Zinc properties for $ 18 million in notes. Private placement of $70 million of 7 7/8% promissory notes with insurance companies, $46.5 million outstanding at year-end (remainder drawn down 1974). Public debt issue of $ 150 millioa $50 million 8.8% notes due 1983 and $ 100 million of 9 3/4% Sinking Fund Debentures due 2000. First time Asarco was in SEC registration since 1937. Tax Exempt Pollution Control Bonds: $55 million through the Nueces River Authority in Texas and $37 million through Lewis and Clark County, Montana. Sale of $87 million in newly issued common stock to The Bendix Corporation (3.8 million shares at $23). By open market purchases and exercise of options, Bendix increased holdings to 20% by the end of the year. Repurchased one million shares of common stock in the open market for corporate purposes. Repurchased $44 million of notes and debentures in addition to scheduled amortization payments. Following stockholder approval at a special meeting, repurchased 6.1 million shares ofAsarco common stock from the Bendix Corporation for $335 million. Privately placed $140 million ofpreferred stock: $77.5 million Series A Preferred; $62.5 million Series B Convertible Preferred. Sold 2.5 million shares of common stock from Asarco's Treasury to M.I.M. Holdings Limited for $141.3 millioa MIM bought Asarco common stock in the open market to bring MDvfs holdings to 4.2 million shares. Public offering of 1,250,000 shares of common stock in December. Ofthe total offering, 930,312 shares were exchanged for the Company's debt securities. First public common stock issue since 1937. Common stock offering completed with issuance of 750,000 shares in February. Public offering of 3,450,000 shares of common stock completed. Stockholders approved an increase of authorized shares to 80 million from 40 million, a classified board of directors and an anti - self dealing amendment to the Certificate of Incorporation. M.I.M. Holdings Limited bought 4,245,800 Asarco common shares increasing to 32.4% its ownership in Asarco. Public offering of 3.45 million shares of $2.25 Depositary Convertible Exchangeable Preferred http;//www. asarco. com/Other/stats_fh.html 10/13/98 ASARCO Page 2 of2 1987 1993 1994 1995 1996 1997 Stock and 3.375 million Common Stock Purchase Warrants completed. Refunding and fixed-rate conversions of $107.6 million oftax-exempt pollution control revenue bonds in Texas and Arizona. Public offering of4,000,000 shares of common stock and a private placement of417,100 shares of common stock completed. Pension plans for salaried and hourly employees restructured. Asarco received approximately $50 million of excess funds in the two plans. $2.25 Depositary Convertible Exchangeable Preferred shares converted for a total of approximately 5,750,000 newly issued shares ofAsarco common stock. The Company retired $68.4 million par value of $69.75 million Series A Preferred Stock outstanding ($1.35 million balance retired February 1,1988) and all $62.5 million Series B Convertible Preferred Stock outstanding. Public debt offerings of $100 million of 7 3/8% debentures due February 1, 2003, $100 million of 7 7/8% debentures due April 15,2013, and $50 million of 7% notes due December 1,2001, to repay revolving credit bank borrowings. Universal shelfregistration statement filed covering future issuance of up to $300 million in equity and debt securities. Public offering of 9.5 million shares of common stock sold by M.I.M. Holdings Limited. Public debt offering of $150 million of 8.5% debentures due May 1,2025. Universal shelfregistration statement filed covering future issuance ofup to $ 150 million in equity and debt securities. Financing arranged for $1 billion expansion and modernization of SPCC facilities. Asarco undertakes $100 million share repurchase program. Asarco refinances $133 million tax-exempt bonds. Return to Tod Statistical Data Home Page ASARCO Home Page http ://www. asarco. com/Other/stats_fh.html 10/13/98