xstrataglencore megamerger in jeopardy
Last Updated : GMT 06:49:16
Arab Today, arab today
Arab Today, arab today
Last Updated : GMT 06:49:16
Arab Today, arab today

Xstrata-Glencore mega-merger in jeopardy

Arab Today, arab today

Arab Today, arab today Xstrata-Glencore mega-merger in jeopardy

Zurich - AFP

The blockbuster merger between Swiss commodity giants Glencore and Xstrata is in jeopardy as key shareholder Qatar threatens to block the union in a vote on Friday in search for better terms. Qatar Holding said last week it opposed the terms of the merger which if completed would create a commodities behemoth worth around 69.8 billion euros ($87.3 billion) according to the current market capitalisation. The investment fund, which is wholly owned by Qatari's sovereign wealth fund and is Xstrata's second-largest shareholder with a 12 percent stake, stressed in a statement that "although it continues to support the principle" of the merger, it has determined that it will not support the current terms. As they stand, the merger terms offer 2.8 new Glencore shares for every one existing Xstrata share, but Qatar Holding has since June demanded Glencore cough up 3.25 shares for each Xstrata existing share, a 16 percent boost. Glencore has flatly refused the increase, but other shareholders have rallied around Qatar's new demands on the deal. According to a Financial Times report, Norges Bank Investment Management, which manages Norway's oil-backed sovereign wealth fund and has hiked its holdings in Xstrata to 3.0 percent, had "privately indicated" its opposition to the current terms of the Glencore-Xstrata merger. Glencore, which owns nearly 34 percent of its coveted compatriot, is not authorised to vote during Friday's general assembly in the small city of Zoug in central Switzerland. The firm has so far staunchly stood its ground amid the mounting pressure from Xstrata's shareholders and has even begun bracing for the possible failure of the deal. Glencore chief, Ivan Glasenberg of South Africa, told Dow Jones Newswires last month that the merger was "not a must-do deal". "We cannot overpay on this asset," he said, adding: "If it doesn't happen, it's not the end of the world, we move forward." Glasenberg also insisted he had not received any persuasive arguments for why his company's offer needed to be raised. "No one has given me any substantive figures" showing that exchanging 3.25 Glencore shares for each of Xstrata's was a reasonable deal. The outcome of Friday's vote is basically already clear, experts say. "Glencore's takeover probably will fail unless Glasenberg raises the offer in time," the CIMB investment bank said in a note. "We think there is a good chance that Glencore could maintain its 2.8 bid going into this Friday's vote (likely) resulting in a vote down of existing terms," RBC Capital Markets agreed. Xstrata's and Glencore's general assemblies were already postponed once at the beginning of July due to Qatar Holding's demand for better merger terms, as well as grumbling over bonuses being handed out to 73 Xstrata top executives, including chief executive Mick Davis. If the merger does fall through, it will not be the end of the world for either of the companies though, analysts say. In the first half of the year, Glencore posted a slightly lower net profit at $2.3 billion, but said it remained in a solid position to grow its revenue. Xstrata meanwhile saw its net profit slump 33 percent in the first half of the year to $1.9 billion, but is benefiting from good organic growth, according RBC.

arabstoday
arabstoday

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

xstrataglencore megamerger in jeopardy xstrataglencore megamerger in jeopardy

 



Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

xstrataglencore megamerger in jeopardy xstrataglencore megamerger in jeopardy

 



GMT 15:46 2018 Wednesday ,12 December

Festive Fashion by Dubai-based designer ASMARAÏA

GMT 12:31 2017 Thursday ,02 November

Gala Dinner Wednesday 8 November, 7.30pm

GMT 13:44 2018 Tuesday ,23 January

Ibrahim meets UNIFIL Commander

GMT 04:23 2017 Saturday ,30 December

Iraq faces 'new war' - on corruption

GMT 13:20 2017 Friday ,29 December

PML-N achieved milestone with inauguration of Hazara

GMT 14:30 2017 Wednesday ,08 March

China’s FX reserves rebound above $3tr

GMT 02:59 2017 Thursday ,12 January

Emirates challenging us for future A380 version

GMT 05:23 2017 Thursday ,10 August

UAE in talks to facilitate air transport with India

GMT 00:43 2016 Thursday ,18 August

Kenya wins East Africa military games

GMT 06:16 2017 Thursday ,16 March

Partnership between Dams Implementation Unit,

GMT 02:08 2017 Tuesday ,12 September

Saudi Airline says US laptop ban lifted

GMT 11:59 2017 Tuesday ,25 April

PSG, Monaco renew battle in French Cup semi-final

GMT 21:24 2017 Thursday ,30 November

Governor of Makkah meets UAE Ambassador
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube

Maintained and developed by Arabs Today Group SAL.
All rights reserved to Arab Today Media Group 2021 ©

Maintained and developed by Arabs Today Group SAL.
All rights reserved to Arab Today Media Group 2021 ©

arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday