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GLENCORE DEAL

Qatar Holding rejects Xstrata merger terms

Paris, August 31, 2012

Qatar Holding, one of the biggest holders in Xstrata, said it opposed the terms of the Swiss miner's proposed merger with commodity giant Glencore and would vote against the deal.

'Qatar Holding announces that, although it continues to support the principle of a combination of Glencore with Xstrata, it has determined that it will not support the proposed merger terms of 2.8 new Glencore shares for every one existing Xstrata share,' it said.

The investment fund said it would vote its entire holding at a shareholders meeting on September 7.

Swiss-based Glencore announced in February plans to merge with Xstrata, creating a $90 billion powerhouse in the commodities industry, but shareholders including Qatar Holding have called for better terms.

Qatar Holding said an exchange ratio of 3.25 Glencore shares 'would provide a more appropriate distribution of benefits of the merger whilst recognising the intrinsic stand-alone value of Xstrata.'

Glencore chief executive Ivan Glasenberg warned last week that it could walk away from the deal if the terms were not right.

The Financial Times reported that Norges Bank Investment Management, the manager behind Norway's sovereign wealth fund, would vote its 2.97 per cent stake against the deal.

With Qatar Holding's stake of around 12 per cent, opponents of the deal were nearing the 16.5 per cent level needed to block it, according to the newspaper.

Qatar Holding said Xstrata had a strong future, whether in combination with Glencore on acceptable terms or as a stand-alone entity, and that its shares are an attractive long-term investment.-Reuters




Tags: merger | Qatar Holding | Xstrata | Glencore | swiss miner |

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