Snub for merger plan

Huddersfield Daily Examiner (Huddersfield, England), June 24, 2009

MINING giant Anglo American has rebuffed merger advances from rival Xstrata - branding the terms of the deal "totally unacceptable".

Anglo said the board had unanimously decided that the proposed tie-up - worth pounds 42bn at current prices - was not in the interests of shareholders.

Swiss-based Xstrata had expressed hopes for a "merger of equals" with FTSE 100 Index rival Anglo.

Xstrata said the deal was "highly compelling" given the pair's interests in multiple commodities and regions.

But Anglo claimed it would have a negative impact on its position in the platinum, iron ore and diamond markets. It said it was putting faith in its existing business strategy as an independent, which it said would deliver "substantial further cost savings".

Anglo added: "The board has therefore concluded that the strategic case for the combination is unattractive for Anglo American shareholders."