Mining giant Xstrata merges with Glencore International

Mining company Xstrata and commodities dealer Glencore International merged Feb. 7 in a $90 billion deal. The merge is not expected to impact Xstrata nickel’s Raglan mine operation in Nunavik, pictured here. (FILE PHOTO)

Mining company Xstrata and commodities dealer Glencore International have agreed to a merger that creates the world’s fourth largest natural resources group.

The deal, reached Feb. 7, is worth about $90 billion (U.S.).

The combined company’s properties would include major nickel mining and refining businesses in Canada, where Xstrata subsidiary Xstrata Nickel owns the Raglan nickel project along Nunavik’s Hudson Strait.

The nickel mine, which Xstrata took over from Falconbridge Ltd. in 2007, employs roughly 850 staff.

The Swiss-based Glencore extracts, ships and refines raw materials from coal, to copper, to corn.

The new company will be the world’s third-largest copper producer, fourth-largest nickel producers and the global leader in thermal coal, ferrochrome and integrated zinc production.

Under the terms of the deal, Xstrata shareholders would receive 2.8 Glencore shares for each of their shares, said a Feb. 7 joint company news release.

Glencore already had a 34 per cent stake in Xstrata.

Xstrata’s operating businesses and Glencore’s marketng function will continue to operate under their existing brands, said the news release, although the combined company is expected to be listed on the Stock Exchanges as Glencore Xstrata International.