CALIFORNIA : BRIEFLY / METALS : Merger Partners Reject Phelps Purchase Offer

Copper companies Asarco Inc. and Cyprus Amax Minerals Co. said their board rejected a $2.6-billion takeover offer by Phelps Dodge Corp. and urged shareholders not to tender their shares to the rival metals producer. The move, which had been widely expected, was a formal response to the hostile bid launched Sept. 3 by Phoenix-based Phelps Dodge. Asarco and Cyprus have been aggressively urging shareholders to support their own $1.5-billion merger plan announced in July. Based on current stock prices, the Phelps Dodge all-stock offer values Asarco at $23.85 a share, or $948 million. It values Cyprus at $18.26 a share, or $1.7 billion. The shareholders are slated to vote on the Cyprus-Asarco merger plan on Sept. 30. Phelps shares rose 38 cents to close at $58.63, Asarco fell 6 cents to $21.88, and Cyprus Amax was unchanged at $17.81. All trade on the NYSE.