Xstrata: “a-must-do” or “not-a-must-do” Deal?
Though it is a good offer made by Qatar, one of the main shareholders of the company, but then according to the chief executive of Glencore (GLEN. L), this $30 billion bid for miner Xstrata (XTA. L) is not a "must-do deal". This is one of the strongest suggestions that the company has made till now.
Following the surprising demand made by the sovereign wealth fund to have perfection to Glencore's offer of 2.8 new shares for every Xstrata share, there has been a heat-up argument between the two.
In this regard, Ivan Glasenberg, while stating a slighter than projected drop in first-half profits by the commodities trader, expressed frustration with Qatar Holding.
The deal was announced in February and since then Qatar has succeeded in building up a stake of almost 12% in Xstrata, whereas Glencore has a 34% share holding in the same. Though the share of Qatar is lower than that of Glencore but then it is enough to obstruct the conquest by voting next month.
As Glasenberg told Reuters in an interview, "We cannot understand the position of the Qataris, asking for more than the 2.8 ratio. We have seen nothing coming out of recent results that support this. In fact we have seen quite the opposite".
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