Liberum Capital has lowered its view and given the deal a 56 per cent chance of succeeding, adding in a note that the markets have already broadly priced in fear of the merger failing.
The deal was announced in February, but has since been dogged by protests over pay deals and a late intervention by Qatar to call for better terms for investors.
Qatar, an 11 per cent shareholder in Xstrata, has asked the firms to bump the offer to 3.25 shares in the enlarged firm per Xstrata stock, up from the current offer of 2.8.
Liberum analysts, however, think this demand will almost certainly not be met, with a more likely improvement coming in at around three new shares.
Experts at Jefferies, meanwhile, have said a full concession to the Qataris would be “more appropriate”.
Investors will vote on the deal on 7 September.