Remember Mick Davis? Mick the Miner, the boss of Xstrata, was so important in the “merger” with Glencore, that he was to be paid zillions simply for turning up for work. Although it was Glencore doing the bidding, the top three jobs in the merged business would all go to Xstrata people. Glencore’s CEO, major shareholder and guiding light, Ivan Glasenberg, would step right back with the rather vague title of “deputy chairman”.

Now look what’s happened. In return for a modest tweak of the terms, the whole deal has been turned on its head. Mick is toast (with a six-month stay of execution so it doesn’t look too obvious) and guess who’s  to be in charge of the new mining-to-trading colossus that is Glenstrata? Yep, it’s cuddly, self-effacing Mr Glasenberg.

He’s made the Xstrata board, from chairman Sir John Bond downwards, look like a bunch of chumps. After puzzling for weeks over whether 3.05 was a bigger number than 2.8, they have come out with a gloriously convoluted set of resolutions to put to the shareholders. What they have not come out with is a recommendation from Qatar Holding, whose rapid acquisition of 12 per cent of the shares effectively sank the previous version of the deal.

Yet despite this ominous omission, this ‘orrible merger is now likely to go ahead. There is the little matter of squaring the various competition authorities around the world, who may worry about an integrated, opaque and oversized mining and trading house manipulating the cost of vital raw materials. Having seen how Mr Glasenberg so comprehensively stitched up the Xstrata board, doing the same with the authorities should be a piece of cake.

Advertisements