Takeover Panel puts pressure on Xstrata bid
XSTRATA was yesterday forced to put out a statement clarifying the cost savings that could be achieved through a merger with rival Anglo American, after the Takeover Panel waded into the stand-off between the two miners.
The Takeover Panel asked Xstrata to clarify its estimates for cost savings following its failure to rebuff suggestions that synergies at a merged group could be worth triple the $1bn (£608m) Xstrata it originally stated.
“Xstrata has quantified pre-tax synergies of over $1bn per annum by the third full year following completion of the proposed merger,” the company reiterated yesterday.
“This estimate is the only one that has been reported on by Xstrata and its advisers. Any other published synergy estimate is not endorsed or supported by Xstrata,” it added.
Last week, Anglo’s board – led by Cynthia Carroll – turned down a nil-premium merger of equals with Xstrata and its bullish boss Mick Davis. Anglo slammed the proposal’s “lack of strategic merit,” and said the terms of the deal were “totally unacceptable”.
Xstrata put added pressure on Anglo after its initial rejection, by releasing the details of cost savings.