Once completed, the merger will be the largest of its kind in the mining industry to date and the largest M&A deal, in money terms, worldwide this year.
King & Wood Mallesons acted for both Glencore and Xstrata on the merger by agreement by both clients. The transaction involved negotiations with deal teams across the world to secure approval from a number of regulatory bodies including, in Australia, the Foreign Investments Review Board (FIRB) and the Australian Competition and Consumer Commission.
The King & Wood Mallesons team was led by M&A partner Nicholas Pappas, who continued his longstanding relationship with Xstrata and Glencore.
Pappas was assisted by partner Wayne Leech who advised on anti-trust issues and partner Andrew Gray who advised on employment issues. Special counsel Malcolm Brennan advised on the FIRB-related aspects and partner Frank Brody provided stamp duty advice.
Under the deal, Glencore, the world’s largest commodities trading company, will acquire all of the remaining 65 per cent shareholding in Xstrata which it does not currently own. Glencore will offer 2.8 new shares to each shareholder in Xstrata, representing a 15.2% premium to Xstrata shareholders
The new entity will be called Glencore Xstrata, and will be one of the world’s largest diversified mining houses and have a combined market capitalisation of US$90 billion spanning mining, agriculture and trading, the firm said.