XSTRATA shareholder Thread-needle, one of the 25 largest stakeholders in the miner, yesterday slammed the recommended £56bn mega-merger with commodities trader Glencore.
Xstrata yesterday backed the tie-up with Glencore, although with conditions.
In a letter sent to shareholders Iain Richards, head of corporate governance at Threadneedle, which holds 0.29 per cent of Xstrata, said he felt “considerable disappointment” that the independent non-executive directors of Xstrata recommended the merger.
Richards added that what was billed as a “merger of equals” was essentially a takeover, which was weighted heavily in favour of Glencore. The deal was giving away Xstrata “on the cheap”, he said.
“We are firmly opposed to this so-called merger of equals, its terms and its implications,” he concluded.
Following opposition from other major shareholders, Xstrata said yesterday it would decouple approval of the merger with approval of hefty management incentives, so shareholders vote on the two issues separately.
In the original all-share agreement, backed by Xstrata in February, shareholders had to support the incentive plan and the Glencore offer, or neither.
Xstrata backed the proposed new merger ratio of 3.05, which was increased from 2.8 in September.
Shareholders will vote on the resolutions in around six weeks’ time.