Xstrata chief exec Mick Davis will step down on completion of the deal, to be replaced by Glencore boss Ivan Glasenberg who will head up the merged company. Davis has agreed to stay on as a consultant until 30 June to facilitate the handover.
Approval from the Ministry of Commerce of the People’s Republic of China was seen as the final hurdle for the deal. The listing of the newly combined company’s shares is now scheduled for 3 May.
The new entity is estimated to be valued at £50bn.
The Chinese decision is subject to Glencore selling its ownership in Las Bambas, a Peruvian copper project being developed by Xstrata.
“The deal is very clever in terms of remedies as Glencore has agreed to sell an asset which isn’t producing well – Las Bambas – rather than dispose of more profitable assets in Britain,” Michael Rawlinson, analyst at Liberum Capital, told City A.M.
Regarding Davis’ departure, Rawlinson added: “It was to be expected. Glencore will want its own management running the company.”
Some critics of the deal had previously suggested that it was weighted toward Glencore, but Jeff Largey, analyst at Macquarie, said he thought the deal would be beneficial in the medium-term for shareholders in both merging companies.