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Xstrata pressures Anglo to accept merger deal
24.06.09
Mining giant Xstrata piled the pressure on the management of Anglo American tonight after this week's rebuff of a £40 billion merger proposal.
Xstrata published last Wednesday's letter to the board of Anglo in which it detailed a nil-premium merger where the enlarged company would share management positions and attempt to put itself in a position to take on arch-rivals BHP Billiton and Rio Tinto.
Publication was designed to woo Anglo shareholders who are upset by the way Anglo chief executive Cynthia Carroll and chairman Sir Mark Moody-Stuart rejected the bid.
Xstrata's chief executive Mick Davis said: "The combination of Xstrata and Anglo American is a natural fit."
Davis denied claims the deal would be a takeover, arguing it could save $1billion (£605 million) a year and would benefit the companies' mining assets in Australia, South Africa and South America.
Davis said: "We remain convinced of the undeniable logic for a merger of equals. It is regrettable that Anglo's board rejected this proposal without any engagement with Xstrata."
Anglo shares shot up 145p to 1797p on hopes the deal could be back on.
