Qatar: We’ll back Xstrata-Glencore deal

Qatar Holdings said it would back Glencore's raised bid for miner Xstrata.

A combination made on 1 October, 2012 of two pictures shows the logo of the Swiss commodities giant Glencore (top) and the logo of the Swiss mining group Xstrata. Picture: AFP

LONDON - Qatar Holdings said it would back Glencore's raised bid for miner Xstrata, paving the way for the $33 billion takeover deal to go ahead.

Qatar, an unexpected kingmaker in commodity trader Glencore's bid for Xstrata, said on Thursday that it would vote in favour of two key resolutions on the takeover, meaning Glencore's plan to create a mining and trading powerhouse is on track.

The vote, which is scheduled for 20 November, ten months after Glencore first approached Xstrata, comes after Glencore in September bowed to investor pressure and raised its bid to 3.05 new shares for every Xstrata share from an earlier ratio of 2.8.

Under a complex structure of votes, Xstrata investors will be able to express their views on a controversial management retention plan without endangering the merger.

Qatar said it would abstain from voting on the pay plan.

The tiny gas rich Gulf state built up a stake of more than 12 percent in Xstrata - a key position in a deal structure that allows just 16.5 percent of Xstrata shareholders to block any bid.