LONDON (AP) ¿ Mining company Xstrata PLC said Thursday that it won't make an offer for rival Anglo American PLC, backing out of a merger proposal which Anglo American had firmly resisted.
In May, Anglo American rejected a merger overture from Xstrata, its Anglo-Swiss rival. The proposed combination would create a group worth $68 billion, ranking the combined company behind BHP Billiton and Rio Tinto.
Thursday's announcement came days ahead of an Oct. 20 deadline set by London's Takeover Panel for Xstrata to "put up or shut up."Xstrata is now barred from making another for Anglo American for at least six months. However, Xstrata said it reserved the right to participate in a third-party bid for Anglo American. Xstrata shares were down 1.8 percent at 1,012 pence on the London Stock Exchange. Anglo American shares were down 3.6 percent at 2,228 pence. "Although Xstrata would clearly love to undertake a deal at some point, for now it is unwilling ¿ and unable ¿ to pay the premium demanded by the shareholders of Anglo American," said Jonathan Jackson, analyst at Killik & Co. in London.