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Freeport-McMoRan, Plains to pay special dividends

PHOENIX (AP) -- Freeport-McMoRan Copper & Gold and Plains Exploration & Production said Monday that they both will pay special one-time cash dividends when Freeport-McMoRan's acquisition of the oil and gas company closes.

The $6.9 billion cash and stock deal is expected to close soon. Plains Exploration shareholders were set to vote on the deal later Monday morning.

Freeport-McMoRan said its board plans to declare a supplemental dividend of $1, which would be in addition to its regular quarterly common stock dividend of 31.25 cents. Based on about 1.04 billion outstanding common shares, the supplemental dividend payment will be about $1 billion, the company said.

Meanwhile, executives from both companies agreed to allow Houston-based Plains Exploration to pay a $3 cash dividend to its shareholders when the deal closes.

Phoenix-based Freeport-McMoRan also said that assuming the deal closes it plans to complete $1.5 billion in asset sales from the combined company, while also possibly reducing its capital spending plans.

Freeport-McMoRan said the asset sales, combined with its cash flows and disciplined approach to capital spending, will allow it to meet its target of reducing debt to $12 billion over three years.

In premarket trading, shares of Plains Exploration & Production Co. rose $3.05, or 7 percent, to $48.60, while shares of Freeport-McMoRan Copper & Gold Inc. rose 31 cents to $32.99.