Qatar Holding has quietly accumulated a 4.7 per cent stake in the Swiss mining giant Xstrata, turning it into the company's third-largest shareholder.
The accumulation of shares, revealed by regulatory filings, comes as the mining company based in Zug, Switzerland, is stalked by the Abu Dhabi-backed commodities house Glencore in a merger deal.
In February, Xstrata announced it was in talks with Glencore over a merger that would create the world's largest natural resources group with a market capitalisation of US$90 billion (Dh330.58bn).
Qatar Holding would be well-placed to reap the benefits of the creation of one of the world's biggest commodities companies if the deal went through, said one analyst, who asked not to be identified. "It's gearing up to be the major play in the commodities space," the analyst said. "It's opportunistic, although resources and commodities are a long-term strategic area of focus."
Xstrata's London-listed shares did not trade yesterday, as markets were closed for the Easter holiday. On Thursday, the shares jumped 3.5 per cent to 1,112 pence each. Glencore's shares, also listed in London, leapt 5.7 per cent to 411.8 pence each.
Beginning in late February, Qatar Holding spent almost £1 billion (Dh5.82bn) acquiring the stake. The company's total holdings are worth £1.58bn at present, with options to purchase 0.379 per cent more of the company's share capital.
If all options were exercised, Qatar Holding would take a 5.1 per cent stake in Xstrata.
Xstrata is the world's largest supplier of thermal coal and the fourth-largest producer of copper.
The so-called "merger of equals" between Xstrata and Glencore would grant investors 2.8 new Glencore shares for every Xstrata share owned.
The combined entity was expected "benefit from strong growth, from both Glencore and Xstrata", analysts from Fitch Ratings wrote last month.
Abu Dhabi's Aabar Investments invested $1bn in Glencore about the time of its initial public offering in May, and retains a 1.43 per cent stake in the company.
Xstrata's biggest shareholders are Glencore, which owns a 33.7 per cent stake, and BlackRock, among the world's biggest asset managers, which owns 5.4 per cent of its stock.
The merger had encountered opposition from Xstrata shareholders including the fund managers Schroders and Standard Life Investments, which are hoping to secure sweeteners for the deal.
The tie-up "could still be blocked by a minority of Xstrata's shareholders at the shareholders meeting required to approve the transaction", analysts from Standard & Poor's wrote, announcing that the company's credit ratings were on "review" as a result of uncertainty over the merger. Three-quarters of Xstrata's shareholders, excluding Glencore, must approve the deal for it to be binding.
Representatives from Xstrata and Qatar Holding could not be reached for comment.
Qatar Holding, fully owned by the Qatar Investment Authority, owns sizeable stakes in a variety of industries including Barclays Bank, Credit Suisse, Spain's biggest utility company Iberdrola, and the luxury retailer Harrods.
