Qatar Holding LLC, the investment arm of the Middle East country’s sovereign-wealth fund, raised its stake in Xstrata Plc as it seeks a higher offer for the largest thermal-coal exporter from Glencore International Plc.
Qatar on July 20 bought 590,390 Xstrata shares for 846.88 pence each, raising its stake to 10.997 percent, it said in a statement today. It was the first acquisition by the country since June 13, when it bought 160,000 shares for 972.5 pence.
The fund has asked Glencore to raise its bid to 3.25 of its shares for each of Xstrata’s, from 2.8, to “provide a more appropriate distribution of benefits of the merger whilst properly recognizing the intrinsic stand-alone value of Xstrata.” Qatar is “firm” on the deal, Prime Minister Sheikh Hamad bin Jassim bin Jabr al-Thani said this month in London.
Xstrata and 34 percent-holder Glencore, based in Baar, Switzerland, will seek investor approval for the merger on Sept. 7. It would create the world’s fourth-largest mining company. A rejection by 16.48 percent of holders is enough to block the bid because U.K. takeover rules prevent Glencore voting on the deal. Xstrata’s board has recommended shareholders approve the offer.
Glencore, the largest publicly traded commodities supplier, is seeking to gain Xstrata’s copper, coal and zinc operations. The takeover by Glencore is the biggest announced this year, according to data Bloomberg compiled.
Xstrata said June 27 it expects the deal to be closed early October. The companies originally targeted the third quarter.