Glencore said the deal was a “merger of equals” and agreed to issue 2.8 new shares for each Xstrata share. At this rate, Xstrata shareholders will get a 15.2 percent premium compared with the share price last Wednesday before the news of the merger talks leaked out. The post of the president and CEO of the new company will be taken by the CEO of Glencore, Ivan Glasenberg, a billionaire owning 15.8 percent of Glencore.

 

The chairman of Xstarta, John Bond, and the company’s CFO, Trevor Reid, will continue to remain in the same position. Glencore own 34 percent of the mining group Xstrata. The other Xstrata shareholders will own 45 percent of the new company that will be named Glencore Xstrata International. There is likely to be a surge in demand in the coming years for commodities from China and other emerging countries due to the merger of Xstrata, the fourth-biggest diversified miner in the world and Glencore. The amalgamated group is likely to have synergies of at least $500 million and will be earnings accretive to Xstrata shareholders in its first full financial year.