Rio Tinto ready to build Simandou after almost 30 years of setbacks
Simandou has faced delays due to legal disputes, political changes, and the challenges of building a 600 km rail and port infrastructure.
Commodities trader Glencore International (LON:GLEN) and Xstrata (LON:XTA) have extended the deadline for closing their $33 billion merger for a third time on Friday, after failing to get regulatory clearance swiftly enough.
But according to sources quoted by Dow Jones Newswires, South Africa’s state-owned electricity provider, Eskom Holdings Ltd., has withdrawn its official complaint lodged with the country’s competition authorities over the merger.
The deal, which has already been approved by the European Union and both companies’ shareholders, had been caught up in lengthy antitrust regulatory processes both in South Africa and China.
Eskom’s support means that Beijing may be the last obstacle standing between the companies and their new combined firm, to be the world’s fourth-largest diversified miner.
Before South Africa’s Competition Tribunal received the news on Eskom’s decision, the parties had confirmed they were putting back the “long-stop” date to March 15.
Experts believe that, without an extension to the current deadline of Jan. 31, the transaction would have collapsed.
“As Glencore is scheduled to release its preliminary results for the year ended 31 December 2012 (the “Preliminary Results”) on 5 March 2013, the parties have agreed the new long stop date in order to give them the flexibility to complete the merger after the release of the preliminary results should they determine that to be appropriate taking into account the status of the regulatory processes in South Africa and China,” said the companies in their joint statement.
If successful the combined new giant would have revenues in excess of $140 billion with as much as 80% of sales earned from mining.
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