Member Article

Glencore makes final offer in Xstrata merger deal

Image by Tila Monto

Commodities trader Glencore has laid out a final bid to merge with mining company Xstrata.

The Swiss giant improved its original offer of 2.8 of its own shares for each Xstrata share, to 3.05, in a deal worth $36 billion.

Glencore, already a 34% shareholder, made the bid on Friday and confirmed it today.

There are significant doubts around whether some Xstrata shareholders will accept the deal. Qatar holdings, which holds a 12% stake, said it was hoping for 3.25 Glencore shares for every Xstrata share.

The deal would also see Glencore’s Ivan Glasenberg take over as CEO after six months, replacing Xstrata’s Mick Davis, who would have held the position permanently under the original proposal.

The first offer was made in February, but was expected to be rejected by Xstrata shareholders. Qatar holdings had announced it would “vote its entire shareholding in Xstrata against the proposed scheme.”

However, Glencore came in with a revised bid just as shareholders were set to vote on Friday.

Xstrata will announce whether or not it will put the bid to its shareholders by 24th September

This was posted in Bdaily's Members' News section by Robert Cooper .