Glencore-Xstrata merger gets high court nod

THE all-share merger between Switzerland-based, UK-listed commodities groups Xstrata and Glencore is expected to become effective on May 2.
Glencore-Xstrata merger gets high court nod Glencore-Xstrata merger gets high court nod Glencore-Xstrata merger gets high court nod Glencore-Xstrata merger gets high court nod Glencore-Xstrata merger gets high court nod

Mick Davis

Staff Reporter

Xstrata announced on Monday that the High Court of Justice of England and Wales had sanctioned the new share scheme, giving the go-ahead for the $90 billion merger which would see the creation of the natural resources group Glencore Xstrata.

Xstrata said an application had been made to the UK Listing Authority and the London Stock Exchange requesting that the last day of dealings in the company’s ordinary shares be April 30 and that the trading of its ordinary shares on the LSE be suspended on May 1.

An application was also made for the suspension of trading in Xstrata ordinary shares on the Swiss Exchange from May 1.

Prior to Monday’s announcement, Chinese government approval was the final regulatory hurdle to the merger.

The Chinese Ministry of Commerce gave the merger the nod, subject to several commitments being met – the most significant being the sale of the $US5.2 billion Xstrata Las Bambas copper development project in Peru by September 30 next year.

Xstrata chief executive officer Mick Davis, who was to head up the merged company for six months, also announced he would step down upon completion of the merger, allowing Glencore CEO Ivan Glasenberg to assume the role of CEO of the combined group.

“My executive team and I are pleased to hand over to the new GlencoreXstrata a company with a strong legacy for value creation and growth, a high quality portfolio of operations and growth options, supported by a very healthy balance sheet,” Davis said.

The new scheme and the merger are expected to become effective on May 2, subject to the completion of the Xstrata court process as set out in the new circular published by the company last October.

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