No, but not never

23 June 2009 By Hugo Dixon Follow @hugodixon

Xstrata s idea of a merger of equals was totally unrealistic. But a deal has strategic merit. So while it s totally legitimate for Anglo to fight for better terms, it shouldn t dig in its heels so deeply that it torpedoes the chance of getting together.

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Anglo American on June 21 rejected Xstrata's preliminary proposal for a merger of equals, citing a lack of strategic merit for its own shareholders and totally unacceptable terms.

The board has concluded that a combination with Xstrata would profoundly impact the nature of the Group's portfolio by significantly diluting Anglo American's unique exposure to the structurally attractive platinum, iron ore and diamond markets while increasing exposure to zinc and nickel, Anglo said in a statement.

Anglo's chief executive Cynthia Carroll told the Financial Times; Case closed, on the basis it was proposed. The company is understood to be willing to consider better terms.

Xstrata proposed the combination to the Anglo board on June 17.

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