Qatar Looks Favorably on Glencore-Xstrata Deal, Premier Says
Qatari Prime Minister Sheikh Hamad bin Jassim Al Thani, whose country’s sovereign fund owns 12 percent of Xstrata Plc (XTA), said the Gulf state looks favorably on Glencore International Plc’s (GLEN) sweetened bid for the Swiss miner.
“We’re looking in favor of doing something between the two companies,” Sheikh Hamad told reporters today in Doha, in response to a question on whether Qatar supports Baar, Switzerland-based Glencore’s $32 billion offer.
A recommendation by Qatar may bring Glencore’s billionaire Chief Executive Officer Ivan Glasenberg closer to combining the two commodity companies in this year’s largest takeover. The transaction, five years in the making, would couple Glencore’s trading operations with Xstrata’s coal, copper and zinc mines, creating a group with 130,000 employees in more than 40 nations.
Xstrata, the world’s largest exporter of coal burned by power stations, on Oct. 1 recommended Glencore’s increased offer. Glencore on Sept. 7 raised its bid to 3.05 of its shares for each one in Zug-based Xstrata after Qatar Holding said the original proposal of 2.8 shares made in February was too low.
Shareholders with as little as a combined 16.5 percent of Xstrata would be able to block the deal. U.K. takeover rules prevent Glencore from voting its 34 percent Xstrata stake to decide if the deal proceeds, which requires 75 percent approval.
Xstrata is still to set a new date for the vote, postponed on Sept. 7 when Glencore, the world’s biggest publicly traded commodities supplier, increased its offer.
Xstrata declined 0.2 percent to 952 pence by the close in London trading after gaining as much as 1.2 percent following Hamad’s comments. Glencore advanced less than 0.1 percent.
Qatar is considering buying a stake in Morgan Stanley (MS)’s commodities unit, Sheikh Hamad also said. “We need a few weeks to look at the details, but we are looking at it seriously,” he said, asked whether Qatar was studying the unit.
Morgan Stanley, the sixth-biggest U.S. bank by assets, held talks this year with private-equity firms including Blackstone Group LP (BX) as it studied options for the unit because banks are barred from some trading under the so-called Volcker rule, people familiar with the company’s deliberations said in June.
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