Xstrata to require negotiation skill to complete coal deal?
The company Xstrata is lining up a deal for Canada's First Coal.
Xstrata may need to use negotiation techniques as it looks to tie up a deal for Canada's First Coal.
An all-cash offer of $153 million (£93 million) has been made for the company and the board of First Coal has unanimously backed the proposal.
Merger and acquisition advisers could now be required as the two parties seek to complete the deal.
Xstrata - which was launched as a public limited company in 2002 - has announced it has already entered in to lock-up agreements with a number of the major shareholders in First Coal, which represents over 50 per cent of the total shares.
According to the Xstrata: "The proposed purchase of First Coal provides [us] with access to coking coal exploration leases in British Columbia, Canada."
For the arrangement to be successful, at least two-thirds of the votes cast at the First Coal shareholders meeting have to be in favour of the move.
Posted by Ken Hayes