Abitibi Metals boosts resource by 62% at B26 polymetallic deposit in QuebecÂ
Indicated resources increased to 11.3 million tonnes from 6.9 Mt.
Leading investors in Swiss commodities giant Xstrata (LSE:XSTA) have expressed their disappointment and frustration at the board’s recommendation of a merger with Glencore (LSE:GLEN) for what they believe to be a takeover “on the cheap.”
The Times(paywall) reports that Threadneedle Investments, amongst Xstrata’s 25 largest shareholders with a stake of 82 million pounds, wrote to the board stating that its handling of the deal was “deeply disappointing” and that the company had given away its future for Glencore’s benefit.
Monaco-based activist fund and top-20 shareholder Knight Vinke inveighed against the board for failure to demonstrate “sufficient independence and robustness” in its handling of the deal, and is believed to be pushing for the ousting of key Xstrata board members including chairman Sir John Bond.
The Xstrata board announced its endorsement of a merger with fellow Swiss-based commodities giant Glencore on Monday, with the revised deal valuing each Xstrata share as the equivalent of 3.05 Glencore shares.
Second-largest shareholder Qatar Holdings had previously stalled what was expected to be an untroubled takeover bid earlier in the year in a bid to obtain an improved valuation for Xstrata shares.
Qatar Holdings is now believed to support the merger at the revised valuation.
The latest agreement is conditional on Glencore CEO Ivan Glasenberg refraining from implementation of management changes for at least two years, in order to assuage concerns that the determined and wily Glasenberg will usurp control post-merger.
The proposed merger will lead to the creation of a new force in the global mining industry comparable in clout and stature to diversified mining giants Rio Tinto (ASX:RIO) and BHP Billiton (ASX:BHP).
Approval from regulators is expected by the end of the year should shareholders vote in favor of the deal.
Related:
Xstrata board endorses Glencore merger deal just shy of deadline
