The Xstrata board spent the weekend thrashing out the details of the improved deal in a bid to satisfy as many shareholders as possible, with a focus on the generous retention package for the firm’s top staff.
Last night, executives were working towards a 7am deadline set by the UK Takeover Panel to recommend the £56bn tie-up.
A recommendation from Xstrata would pave the way for the biggest merger of the year, which has been beset by obstacles since February, to finally reach a shareholder vote – pencilled in for November under the latest timetable.
Investors in Xstrata are said to disagree with each other over backing the firm’s retention payouts, so the board has discussed dropping a binding vote on the remuneration plans, which have already been watered down.
This would allow dissenting shareholders to reject the pay packages in a non-binding vote without sinking the entire merger, as some had threatened over the summer.
Glencore, the Swiss commodities giant that floated in London last year, sweetened the financial terms of the deal earlier this month.
It hiked its offer to 3.05 new shares per Xstrata share from its original 2.8, in a bid to appease investors led by Qatar Holding, Xstrata’s second biggest shareholder after Glencore itself.
Under the new deal Xstrata chief executive Mick Davis will step down after six months, leaving Glencore boss Ivan Glasenberg in charge.
Xstrata intends to replace Davis on the board with another of its representatives.
The deal is not expected to close until next year, due to the number of regulatory approvals needed.