Xstrata open to offers

More excitement in the mining sector today, with Xstrata telling the world that it's up for sale to the highest bidder. It could make a nice Christmas present for a loved one, if you've got a spare £40bn lying around.

Last Updated: 31 Aug 2010

With BHP Billiton continuing to court rival Rio Tinto, and consolidation in the air, Xstrata has clearly decided that it’s a good time to cash in. Ironically, in recent years it's gained a reputation as an aggressive buyer – but now that other buyers seem to be in the market, it has apparently concluded that now’s the right time to sell.

Unfortunately, it hasn't bothered to take a course in Plain English first. ‘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,’ it said today. Which we think means: ‘We’re talking to a few potential buyers’.

The early favourite in the bidding is Brazilian mining giant Vale, though according to the FT Xstrata chief executive Mick Davis is also trying to woo Cynthia Caroll, his counterpart at Anglo American. Plus there’s always a chance that if BHP continues to get the cold shoulder from Rio, it could switch its attentions elsewhere. Though with a market cap of about £36bn, Xstrata isn’t exactly a stocking filler.

The mining sector seems to be turning into the corporate equivalent of a school disco, with a few attractive propositions circling flirtatiously round the middle of the room, and potential suitors hovering shyly in the wings, afraid to show their hand.

But while Xstrata seems happy to be the centre of attention, Rio’s looking more like the sulky teenager. With BHP continuing to communicate largely in winks and nudges, Rio is rapidly running out of patience – apparently it’s asked the Takeover Panel to issue a ‘put up or shut up’ deadline, in an attempt to force BHP to put its money where its mouth is.

BHP responded today by outlining exactly how much bigger and better than Rio Tinto it really is. But it looks as though it will have to do some serious legwork if it’s going to pick up Rio this Christmas...

Find this article useful?

Get more great articles like this in your inbox every lunchtime

Why you overvalue your own ideas

And why you shouldn't.

When spying on your staff backfires

As Barclays' recently-scrapped tracking software shows, snooping on your colleagues is never a good idea....

A CEO’s guide to smart decision-making

You spend enough time doing it, but have you ever thought about how you do...

What Tinder can teach you about recruitment

How to make sure top talent swipes right on your business.

An Orwellian nightmare for mice: Pest control in the digital age

Case study: Rentokil’s smart mouse traps use real-time surveillance, transforming the company’s service offer.

Public failure can be the best thing that happens to you

But too often businesses stigmatise it.