UPDATE 1-Xstrata CEO says selling to another company possible
Wed Apr 30, 2008 8:49am EDT
reuters.com
By Sam Cage
ZURICH (Reuters) - Anglo-Swiss miner Xstrata's (XTA.L: Quote, Profile, Research) chief executive Mick Davis said he would have no problem with the company being bought by another, following the breakdown of talks with Brazil's Vale (RIO.N: Quote, Profile, Research) (VALE5.SA: Quote, Profile, Research).
A potential $90-billion deal for Vale, the world's top iron ore producer, to buy Xstrata fell through last month. Davis said on Wednesday he would have been "very comfortable" if the takeover -- which would have been one of the world's biggest -- had gone through.
"I have no issue with Xstrata being bought by another company, if that provides the best value for shareholders. I have no issue personally with riding off into the sunset if that's what makes the deal happen," Davis said at a British Swiss Chamber of Commerce event in Zurich on Wednesday.
"If you look at Rio Tinto, I think even the largest companies are capable of facing corporate action," Davis said.
Rio Tinto (RIO.L: Quote, Profile, Research) (RIO.AX: Quote, Profile, Research) rejected a $147 billion bid from BHP Billiton (BLT.L: Quote, Profile, Research) (BHP.AX: Quote, Profile, Research) in February.
"We will continue looking for further value, value both in bolt on acquisitions...and if we find a large transaction out there that is in the universe of the possible, we'll do that too," Davis said.
Xstrata shares trading in London pared losses on the news and were 0.8 percent lower at 3,947 pence by 9:57 a.m. EDT. The stock had previously hit a session low of 3,879 pence.
Vale's chief executive has said the talks collapsed due to a dispute over future marketing rights -- Xstrata's main shareholder, commodities trader Glencore International GLEN.UL holds marketing rights to a large chunk of Xstrata's output in nickel, copper and other metals.
Speculation about a tie-up between Xstrata and Anglo American Plc (AAL.L: Quote, Profile, Research) will resurface now the Vale deal has fallen through, analysts have said.
(Reporting by Sam Cage; Editing by David Cowell and Sophie Walker) |
