Xstrata merger gets yes vote from Glencore shareholders

Glencore shareholders backed the commodity trader’s proposed £56 billion merger with Xstrata in the first of a series of investor votes planned for today which look set to approve the long-awaited deal after nine months of wrangling.

Some 99.5% of Glencore’s investors approved the merger, a result that didn’t come as much of a surprise since the company’s staff own more than four-fifths of the shares.

In a much tenser ballot, Xstrata’s investors are also expected to bless the deal today.

However, they could vote against a controversial £140 million package of retention bonuses that Xstrata is seeking to tie into the deal to help keep 70 key staff at the combined company.

In a complex ballot, Xstrata investors will cast three votes to determine whether the deal should proceed and, if so, whether it should be with or without the retention bonuses.

Shareholders in Xstrata became all but certain to approve the deal last week after 12% stakeholder Qatar and other key investors gave their public support to the transaction, on which Glencore, a 34% shareholder, is unable to vote.

Crucially, Qatar said it would abstain from the vote on the retention package. This will be much more finely balanced than the vote on whether the merger should proceed.