INTERNATIONAL COAL NEWS

Qatar ups stake in Xstrata

QATAR Holding has increased its stake in Xstrata ahead of a vote next month on its $A90 billion m...

Kristie Batten

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The investment company acquired a further 18.5 million shares, or 0.6% of the company, taking its stake to 11.06% or 332 million shares.

The shares were purchased at £8.53 ($A12.66) per share.

It comes after Qatar bought almost 600,000 shares on July 20.

The company has been building its stake in Xstrata since the merger was first announced in February.

However, it has asked Glencore for better terms.

Qatar said in June that while it saw merit in a combined entity, it had informed Glencore 3.25 shares for every one Xstrata share was a more favourable ratio.

Glencore is currently offering 2.8 shares for every one Xstrata share held.

Bloomberg reported overnight that Glencore would probably raise its bid when it reports

first-half earnings on August 21, according to investment banking firm Jefferies Group.

Jefferies reportedly expects Glencore to increase its offer from 2.8 of its shares for each one in Xstrata to three shares.

The vote is scheduled for early next month and can be blocked by just 16.5% of Xstrata shareholders.

Xstrata shares closed 1.5% higher overnight in London to £8.61.

This article first appeared in ILN's sister publication MiningNews.net.

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