IE 11 is not supported. For an optimal experience visit our site on another browser.

Xstrata says held initial talks, no proposals made

JOHANNESBURG (Reuters) - Mining group Xstrata <XTA.L> said on Wednesday it had held preliminary talks about possible mergers, but the discussions resulted in no proposals.
/ Source: Reuters

JOHANNESBURG (Reuters) - Mining group Xstrata said on Wednesday it had held preliminary talks about possible mergers, but the discussions resulted in no proposals.

"None of these very preliminary discussions have resulted in any proposal being made either for or by Xstrata and there can be no certainty that any such proposal will result," the company said.

Xstrata, which press reports have linked to interest from potential suitors such as Vale and Anglo American , said it put out a statement in response to media speculation about a possible merger, which has intensified in recent days and sent its shares surging.

"Xstrata confirms that its ongoing interaction with other industry participants includes dialogue with a number of parties covering a range of topics of mutual interest such as industry consolidation," the statement said.

"Xstrata is continually reviewing opportunities within the industry with a view to adding value to its shareholders."

Xstrata shares have shot up about 30 percent since November 22, riding a renewed wave of takeover speculation since the world's biggest mining group BHP Billiton shook the sector by unveiling a plan on November 8 to acquire number three Rio Tinto .

On Tuesday, Xstrata shares jumped by as much as 4.6 percent after the Financial Times said the firm was open to talks with potential suitors including Vale and Anglo American while weekend newspapers said Vale had hired bankers to consider a bid.

The shares finished 2.2 percent higher on Tuesday at 3,738 pence.

Xstrata held an investor conference last week, highlighting its growth prospects in copper, coal and nickel.

At the conference, Chief Executive Mick Davis said BHP's move to acquire Rio was likely to lead to another wave of mergers in the sector.

"I think we are the most perfectly positioned company in the industry, the company which is going to benefit from consolidation in any way that it actually transpires."

(Reporting by Eric Onstad; Editing by Quentin Bryar)