Qatar fund backs Swiss mega-mining merger
AFP · 15 Nov 2012, 19:50
Published: 15 Nov 2012 19:50 GMT+01:00
- Xstrata seeks shake-up at troubled Lonmin (15 Nov 12)
- Glencore warns of gloomy outlook (01 Nov 12)
- Xstrata and Glencore agree massive tie-up (01 Oct 12)
Qatar Holdings, which is the second largest shareholder in Xstrata with 12 percent of its equity, had been holding out for 3.25 Glencore shares for one Xstrata share, but it said it now accepted the 3.05 final offer.
"QH continues to see merit in a combination of the two companies and is satisfied with the terms of the proposed merger, having secured the improved exchange ratio of 3.05 new Glencore shares for every one existing Xstrata share," the fund said in statement.
The Qatar fund's rejection in June of Glencore's original offer of 2.8 of its shares for each Xstrata share had been a major blow to the proposed merger.
The fund also announced that it would abstain on proposals to retain top Xstrata top executives in the new merged company out of deference to corporate governance concerns in Britain where both companies are listed.
"QH strongly believes that retaining Xstratas operational management is of critical importance to the successful and stable integration of the two companies, the completion of key projects within agreed timescales and to maximising the benefits of the merger," it said.
"However, QH is conscious of the sensitivities concerning governance issues in the UK and does not feel it appropriate to influence the outcome either way."
Glencore, based in the canton of Baar in central Switzerland, had offered to pay "appropriate" bonuses to Xstrata managers and let Xstrata chief executive Mick Davis head the new commodities behemoth for six months, before making way for Glencore chief Ivan Glasenberg.
Commodities trader Glencore and miner Xstrata formalised in February the highly anticipated deal to create a raw materials juggernaut with a market capitalization of $90 billion.