Xstrata-Glencore merger will proceed

Xstrata’s shareholders have been approved the all-share merger of Xstrata plc and Glencore International plc.

The merger will proceed, subject to outstanding regulatory approvals and UK Court approval.

Switzerland-based Xstrata maintains Ontario operations in Sudbury and Timmins.

The company reports that the Revised Management Incentive Arrangements will not be put in place to retain key Xstrata operational and management personnel.

In a Nov. 20 release, Sir John Bond, Xstrata plc Chairman welcomed shareholders’ support for the merger.

"I have said consistently that I would do what is in the best interests of the company. In the light of shareholders’ decision not to support the board’s recommendation, I have informed the Xstrata plc board and Glencore’s current chairman that, once the merger has completed, I intend to instruct the board to commence an orderly process to appoint a new independent chairman of Glencore Xstrata plc. Upon the satisfactory conclusion of the search process, overseen by the Glencore Xstrata plc board nominations committee, I will step down.”

Mick Davis, Xstrata plc Chief Executive Officer, said: “I have been privileged to lead a team of exceptionally talented and capable managers over the past ten years. Together we have created one of the world’s leading mining groups from inauspicious beginnings and delivered enormous value to all of our shareholders, including Glencore. The corporate culture, values and world-class portfolio of assets and growth projects we have developed over that time are a source of pride and will make a significant contribution to the combined company.

“I regret the decision of shareholders not to approve these retention arrangements for the members of my senior and operational management deemed crucial to the success of the combined group as, in my view, this introduces unnecessary risks to the merged company’s future value proposition.

“Shareholders, however, have spoken clearly and we respect their views. I would like to thank my senior team for the professionalism they have shown over the past ten years in running our operations and delivering our major growth projects as efficiently and safely as possible.“