EXECUTIVES MINE GOLD IN CYPRUS-AMAX MERGER

EXECUTIVES MINE GOLD IN CYPRUS-AMAX MERGER

Cyprus Minerals Co. President Milton F. Ward will get about $6 million for pulling off the biggest merger in mining history if shareholders approve combining the company with Amax Inc.

The merger, expected to close next month, creates a bonanza for Mr. Ward as well as top Amax executives, by triggering so-called "change-of-control" clauses in the contracts of executives at both companies.Those clauses accelerate or pay out retirement benefits, performance bonuses or restricted stock options as if the contract had been terminated, according to details of the agreement in a proxy statement filed with the Securities and Exchange Commission.

Mr. Ward's awards total $6.3 million, according to the document. Mr. Ward, 60, is chairman and chief executive of Cyprus as well as company president.

Allen Born, president, chief executive and chairman of Amax, will reap nearly $9 million, including $5.2 million in severance payments and pension credit benefits when he resigns as chairman and chief executive of Alumax, Amax's aluminum subsidiary that will be spun off in the merger.

Mr. Born, 59, also owns 200,000 restricted shares of Amax stock that will be considered vested and eligible for sale at the time of the shareholder approval. Amax stock closed Tuesday at $23.625 a share, unchanged.

Other senior executives and officers of the two companies also will get millions in benefits payouts whether they stay on with the combined company or trigger "golden-parachute" clauses if they lose their jobs in the merger.

Shareholders of both companies will vote on the proposed merger Nov. 11 at separate meetings in New York.

Stockholders are expected to ask tough questions at the meetings, particularly concerning executive compensation and the payouts, according to some analysts.

Insiders have said that grumbling already can be heard at Cyprus' headquarters about the money destined for Mr. Ward and Mr. Born. Of most concern is that the multimillion dollar payouts come as the two companies are deciding what jobs to cut and how many people to get rid of in order to make the merged company more efficient.

But outside the company, industry observers say such payouts are deserved, particularly in Mr. Ward's case.

When he was hired for the company's top spot in May 1992, Cyprus was adrift with no real direction and dismal earnings. Since taking over, Mr. Ward has made promises of change and kept them, winning the applause of analysts in the process.

"It took him no time to refocus Cyprus Minerals, a company that was spread too thin and burning rubber, not getting anywhere," said Vahid Fathi, a mining analyst with Kemper Securities in Chicago. "If that comes with a price tag like $6 million, I suspect that's money well spent. Over the long

haul, shareholders will benefit handsomely from what he's doing."

Mr. Ward has said his focus would be on expanding the company's core businesses of copper and coal. To that end, Cyprus was selected Tuesday from a dozen other companies competing for a 51 percent interest in the El Abra copper property in Chile in partnership with LAC Minerals Ltd. of Canada.

The mine is believed to be one of the largest copper deposits in the world with an estimated 500 million metric tons of reachable copper that is easily and inexpensively mined.

"By industry standards, this is beyond giant. It's the best copper deposit in the world," said Douglas Silver of Balfour Holdings, mining consultants and analysts in Denver.

If shareholders and regulators approve the Cyprus and Amax merger, the surviving company, to be known as Cyprus-Amax Inc., will be the nation's largest mining company. If they had been combined last year, the companies would have reported more than $2.8 billion in revenue.