Clara Ferreira-Marques and Kate Holton London
Qatar Holding, Xstrata’s second-largest investor, has held back immediate support for Glencore’s raised bid for the mining company, despite an apparent rapprochement last week, saying yesterday it was still considering its position.
The gas-rich Persian Gulf state has become an unexpected kingmaker in commodity trader Glencore’s now $36 billion (R294bn) bid for Xstrata, the fourth-largest diversified mining company, and its efforts to create a mining and trading powerhouse.
Through aggressive buying in the market since the proposed takeover was announced in February, Qatar’s sovereign wealth fund has built up a stake of more than 12 percent in Xstrata – a key position in a deal structure that allows just 16.5 percent of Xstrata shareholders to block any bid.
“Qatar Holding wishes to make clear that it has made no decision yet as to whether or not it would accept the revised proposal,” it said yesterday.
“Qatar Holding will make its decision in due course after giving careful consideration to the implications of the proposed management changes, the other elements of the revised proposal and the views of Xstrata’s board.”
Qatar Holding’s surprise announcement in June that it would not support the initial offer from Glencore, which owns 34 percent of Xstrata, eventually forced the commodities trader to back down at the last minute last week and increased its all-share bid, although not to the ratio initially demanded by the sovereign fund.
Sources familiar with the matter have said Qatar Holding felt little pressure to decide on its position immediately and could even wait beyond a statement from Xstrata’s board, due by September 24, and hold out until closer to a vote. – Reuters