Qatar is demanding another $4.2 billion from Glencore (GLEN) International Plc for Xstrata Plc at the same time that analysts are reducing profit estimates for the Swiss mining company faster than its peers.
Xstrata, due to report first-half earnings on Aug. 7, will post a 39 percent drop in net income for 2012 to $3.5 billion, according to the average of seven estimates compiled by Bloomberg in the past month. The analysts have cut their projections by an average 25 percent, or $1.2 billion, in the last 28 days. Glencore’s profit will fall 2.7 percent for the year, according to six analyst estimates made in that period.
Glencore’s 17 billion-pound ($26 billion) all-share offer was derailed when Qatar’s sovereign wealth fund, the second- largest holder, said last month it wanted the bid raised by 16 percent. Xstrata is the biggest exporter of utility-grade coal. Prices for the fuel “collapsed” in the second quarter, according to Credit Suisse Group AG, slumping about 17 percent.
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