Xstrata PLC on Thursday confirmed that the vote by its shareholders on the $60-billion (U.S.) merger with Glencore International PLC will be delayed, as the Australian antitrust authorities separately blessed the marriage of the miner with the commodities trader.
Documents are expected to go out to shareholders within the next few days, according to people familiar with the matter. They will lay out the revised management retention payments, agreed last week, as well as a new date for the shareholder vote, previously scheduled for July.
Xstrata last week bowed to shareholder pressure, introducing performance hurdles on the proposed retention payouts, which will now be paid in stock. Under U.K. rules, shareholders must have 20 days to consider the revised deal, meaning the soonest likely date for a vote is early August.
However, the deal remains under threat after Qatar Holding, which owns about 11 per cent of Xstrata, publicly demanded better terms to secure the sovereign fund’s support. Qatar has said it believes Xstrata’s long-term value merits 3.25 Glencore shares for each of the miner’s, rather than the 2.8 currently on offer.
With several antitrust approvals yet to be secured for the combination, including from the European Union, China and South Africa, the companies now expect the deal to take until October to close, suggesting a later date for the vote is possible.
Australia’s antitrust watchdog said on Thursday that it would not stand in the way of the combination, arguing that it did not see substantial anti-competitive effects from combining Xstrata’s production with Glencore’s marketing activities.