Xstrata statement:
Response to speculation
Zug, 2 February 2012
Xstrata plc (“Xstrata” or the “Company”) confirms that it has received an approach from and is in discussions with Glencore International plc (“Glencore”) regarding an all share merger of equals which may or may not lead to an offer being made by Glencore for Xstrata. There can be no certainty that any offer will be made.
In accordance with Rule 2.6(a) of the City Code on Takeovers and Mergers (the “Code”), Glencore is now required, by no later than 5:00 p.m. on 1 March 2012, to either announce a firm intention to make an offer for the Company in accordance with Rule 2.7 of the Code or announce that it does not intend to make an offer, in which case the announcement will be treated as a statement to which Rule 2.8 of the Code applies. The deadline can be extended with the consent of the Panel in accordance with Rule 2.6(c) of the Code.
So, finally, the plan is for an “all share merger of equals.” The two companies do in fact have similar market caps.
The FT’s Javier Blas on the matter here and Bloomberg here.
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Update 10:12 London time: Glencore has issued the following statement saying there is “no certainty that any offer will be made”.
Glencore International plc (“Glencore” or the “Company”) notes the announcement by Xstrata plc (“Xstrata”) earlier today regarding a possible all share merger of equals between Xstrata and Glencore. There can be no certainty that any offer will be made. A copy of Xstrata’s announcement is appended to this announcement.
In accordance with Rule 2.10 of the City Code on Takeovers and Mergers (the “Code”), the Company confirms that, as at the close of business on 1 February 2012, it had in issue 6,922,713,511 ordinary shares of U.S.$0.01 each with ISIN JE00B4T3BW64.
In addition, the Company confirms that there are in issue U.S.$2.3 billion in principal amount of 5 per cent. guaranteed convertible bonds due December 2014 issued by Glencore Finance (Europe) S.A., one of Glencore’s financing vehicles.
The convertible bonds are convertible into ordinary shares in the Company. The ISIN for the convertible bonds is XS0475310396.