Tony Blair steps in to rescue £50bn Glencore deal

 

Tony Blair's diplomatic skills are said to have come to the rescue of a £50bn merger deal in danger of collapse.

Shareholders in the multinational mining corporation Xstrata had been expected to throw out a proposed merger with the trading house Glencore when they met yesterday at Xstrata headquarters in Zug, Switzerland.

The deal would see Xstrada's highly rated boss, Mick Davies, sacked with a goodbye package worth several millions, and replaced by the billionaire commodities trader Ivan Glasenberg, the head of Glencore. It appeared to be doomed because of the opposition from Xstrata's biggest independent shareholder, the oil rich sheikhdom of Qatar, whose Qatari Investment Authority holds 12 per cent of the shares.

The Wall Street bank, JP Morgan, are Qatar's bankers, and retain the services of Tony Blair as a member of their advisory board, for a reputed annual fee £2.5m. According to the Financial Times, the former prime minister brokered last-minute talks between Mr Glasenberg, and the prime minister of Qatar, Hamad bin Jassim Al Thani, before the crucial shareholder meeting. Mr Blair's office declined to comment.

The two men did not reach an agreement, but the proposed merger has been kept alive by an increased offer from Glencore.

"This is not a firm offer. Any elements of the proposal remain subject to change and the proposal also remains subject to Xstrata plc board approval," Xstrada said yesterday.

Mr Blair's demonstrated his skill as a negotiator in Downing Street when he achieved what had previously appeared to be impossible by persuading opposing sides in the Northern Ireland conflict to come to the negotiating table and sign an agreement.

Since leaving he left office in 2007, he has tried to do a similar job in the Middle East as special envoy for the "Quartet' – the US, United Nations, the EU and Russia.

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