Xstrata and Glencore were scrambling to sort out their differences today ahead of Monday’s deadline to agree the final terms of an $80 billion (£49 billion) mining and commodity trading mega-merger between the two.
Xstrata is thought to be concerned about the composition of the board of the combined entity, and is seeking assurances that one of its executives will take chief executive Mick Davis’ position on it when, as proposed, he leaves six months after the merger. This would ensure that the company retains six people on the board to Glencore’s five.
The boardroom issue forms part of discussions about Glencore’s revised offer for Xstrata, made after key shareholders such as Qatar indicated that its initial offer was too low.
Glencore’s latest offer would give Xstrata 3.05 of its shares for each of theirs — up from an initial ratio of 2.8. However, a condition of the revised offer stipulated that Glencore’s chief executive Ivan Glasenberg would run the enlarged group instead of Davis.
Xstrata has been given until 7am on Monday morning to accept or reject Glencore’s sweetened bid.
