EU delays Glencore deal verdict after concessions
BRUSSELS (Reuters) - EU antitrust regulators extended their review of Glencore's (GLEN.L) $33 billion bid for miner Xstrata XTA.L to November 22, after the trader offered concessions to ease concerns over the combined group's slice of the European zinc market.
The European Commission, which had been due to reach a deal by November 8, said on its website on Wednesday that Glencore submitted its proposals on Tuesday, but it did not provide details, in line with standing policy.
Industry sources have said Glencore's desire to avoid an in-depth investigation in Brussels - which would drag the already drawn-out merger with Xstrata XTA.L into next year - would prompt it to respond to the call for disposals in zinc metal, where market concentration is most significant, but where margins are also lower than in mining.
Zinc ore is, most of the time, concentrated at the mine and then sent to the smelter. Zinc metal is the processed form of zinc concentrate.
Glencore declined to comment on the concessions offered, but assets that could make the list include Glencore's Portovesme, a lead and zinc smelter in Sardinia, and Xstrata's Nordenham plant in Germany. The much larger San Juan de Nieva plant, owned by Xstrata, could also be offered up.
One of the sources said San Juan would be "highly unlikely" to be top of Glencore's list given its size - the plant produces almost 500,000 metric tons of zinc a year, more than three times the amount produced by Nordenham. Others, though, said it could be offered up to speed the regulatory process.
Selling San Juan alone would reduce Glencore Xstrata's grip on the European zinc metal market to 28 percent from 50 percent.
A person familiar with the matter told Reuters earlier this week that the EU competition watchdog had asked for concessions in its zinc operations before deciding on the proposed deal.
- Still no sign of Malaysian jet lost in 'unprecedented mystery' |
- Timeline: The search for missing Malaysian jet
- Missing Malaysian jet may have disintegrated in mid-air: source |
- Exclusive: Malaysia plane probe narrows on mid-air disintegration - source
- Mexico kills drug kingpin reported dead years ago: official