Glencore and Xstrata plan giant commodity merger

Zug, Switzerland (dpa) - Glencore, the world‘s largest commodity trader, has started talks with mining company Xstrata about a merger, both companies announced Thursday.

The combined value of the two Swiss-based companies - which are both listed in London - would be some 52 billion British pounds (82 billion dollars).

Glencore has a market value of nearly 30 billion pounds and already owns a more than a third of Xstrata, which is valued at 33 billion pounds.

Both sides said it was not yet certain that an offer would be made.

Glencore shares rose 4.8 per cent to 20.75 pounds on the news, while Xstrata shares shot up 10 per cent to 112 pounds on the London stock exchange.

The commodity trader made 92.1 billion dollars in revenues in the first half of last year. The mining firm made 16.8 billion dollars in that period.

In 2002, Glencore sold Australian and South African mines to Xstrata, making it the world‘s largest exporter of coal for use in power generation. dpa al hm Author: Albert Otti