Commodities trader Glencore International will formally notify the European Commission of its proposed merger with Xstrata for consideration under EU rules.
Glencore said on Friday that both companies were familiar with the commission's merger control process “and together look forward to working with the commission in a process which avoids the need for multiple filings with national member state authorities”.
The companies expected the merger not to result in “any negative impact” on competition in the commodity markets in which the two groups operated.
“In fact, the merged firm is expected to be able to offer customers a wider range of products and services and provide improved security of supply to satisfy customer demand,” Glencore said.
Earlier this month the directors of Glencore and the independent Xstrata directors stated that they had reached agreement on the terms of a recommended all-share merger of equals.
This would lead to the creation of a major natural resources group with a combined equity market value of US$90 billion and a unique business model, fully integrated along the commodities value chain, from mining and processing, storage, freight and logistics, to marketing and sales, the parties said in their initial announcement of the merger.
The management team would be led by current Xstrata CEO, Mick Davis, as CEO of the combined group, with Ivan Glasenberg, current Glencore CEO, as Deputy CEO and President. Trevor Reid, current Xstrata CFO, would be CFO and Steven Kalmin, current Glencore CFO, would serve as Deputy CFO.
Both companies would also have to seek regulatory approval from China and Australia as well as SA for the proposed merger. - I-Net Bridge