Report: Xstrata, Glencore $80B Merger to be Completed this Week

The blockbuster 'merger of equals' between Xstrata and Glencore is nearing completion, media reports said, which indicated too that barring further glitches, the deal will be finalised by Tuesday this week.

Estimated to carry worth of more than $80 billion, the deal promises to be biggest the mining industry will witness, bringing together the world's number four mining operator and the largest diversified commodities trader.

Sources cited by Reuters suggested Sunday that Xstrata and Glencore officials have ironed out two important details that would ensure the deal would push through time, following an earlier negotiation that fell through due to valuation disagreements.

Reports have earlier emerged that Glencore is prepared to offer 11 percent premium of Xstrata shares that effectively represent the mining group's maximum worth, which would also satisfy the demands already articulated by a number of major Xstrata investors.

"We will be making very sure that (the deal) maximizes value for Xstrata shareholders, which means a nil premium merger is not a runner," one Xstrata investor was quoted by Reuters as saying last week when reports of the impending merger came out.

Reuters also reported that Glencore is all set to approve a union that would lead to Xstrata wielding a majority control of the two entities' fused boards, with Xstrata chief executive Mick Davis retaining his post.

According to the Sunday Times, Davis is poised to receive about $16 million as retention package once the deal has been formalised.

Davis has been at Xstrata helm for more than a decade, making him as the longest serving mining CEO to date.

Also, the new corporate set up of the merged firms will also allow Xstrata chair John Bond and chief financial officer Trevor Reid to carry over their current roles into the new entity, Reuters said.

Glencore CEO Ivan Glasenberg, the Reuters source added, has been given a key executive position, with experts noting that his trading expertise would be crucial in ensuring the continued success of the merged companies. Glasenberg is Glencore's largest single shareholder and he will retain that distinction even as the giant deal will be pushed into realisation.