Business

Morning business round-up: Xstrata get new Glencore bid

  • 7 September 2012
  • From the section Business

What made the business news in Asia and Europe this morning? Here's our daily business round-up:

Mining firm Xstrata has received a fresh takeover proposal from Glencore that contains a compromise to meet the demands of a key investor.

Glencore raised its offer to 3.05 of its shares for each Xstrata share, from the 2.8 previously offered.

Qatar Holding, which owns about 12% of Xstrata, had said it would block the merger as it wanted a ratio of 3.25.

Earlier, Glencore had delayed Friday's shareholder meeting to vote on the original proposal.

Glencore has also proposed that its chief executive Ivan Glasenberg should lead the merged entity instead of Xstrata's boss Mick Davis, who would have been the new chief executive under the old terms.

Under the old deal, Mr Glasenberg would have become deputy chief executive of the new business.

The euro has strengthened to a two-month high against the US dollar, as the European Central Bank's bond-buying plans continued to please the markets.

The euro rose 0.3% to $1.2673 in early trading on Friday.

It also hit a two-month peak against the Japanese yen and a one-month peak against the Swiss franc.

Yields on Spanish and Italian 10-year bonds fell further, easing implied borrowing costs for the debt-laden countries.

Lufthansa cabin staff have begun a 24-hour nationwide strike, affecting about 900 flights and causing disruption for thousands of passengers.

A Lufthansa spokesman said: "On average there are 1,800 Lufthansa flights during a normal day, around half of these will take place."

All German regions and all types of flights have been affected, said the spokesman, including long-haul.

Media captionBusiness headlines

Facebook has finalised the purchase of Instagram, according to the photo-sharing website's founder.

The social networking site bid $1bn (£628m) for Instagram in April, and was given the green light for the deal from US regulators at the end of August.

But, after the sharp fall in Facebook shares since the firm went public in May, the cash plus share offer ended up being worth nearer $700m.

Facebook shares launched at $38 each but closed on Thursday at $19.

Hungarian Prime Minister Viktor Orban has rejected as unacceptable the conditions attached by the International Monetary Fund (IMF) to a new 15bn-euro (£12bn; $19bn) loan.

On his Facebook page, he said the list of the loan terms "contains everything that is not in Hungary's interests".

Mr Orban said this included pension cuts and the withdrawal of a tax on banks.

He said his government would present an "alternative negotiation proposal".

The IMF has not publicly commented on Mr Orban's remarks.

The latest Business Daily programme from the BBC World Service considers whether the pallet is the most important object in the global economy.

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