LONDON-- Xstrata PLC (XTA.LN), a mining company, said Wednesday
regarding the merger with Glencore International (GLEN.LN) that
retention awards for all recipients will be paid entirely in shares
in the Combined Group, further aligning management's interests with
shareholders
MAIN FACTS:
-100% of retention awards for Xstrata Executive Directors and
the other Executive Committee members will be subject to
performance criteria based on realising additional cost savings as
a result of the Merger in the two years following the effective
date.
-For Xstrata's senior management, excluding the Executive
Directors and six other Executive Committee members, awards will be
paid in equal tranches at the first and second anniversaries of the
closing of the transaction.
-The number of shares in the Combined Group to be awarded under
the amended retention arrangements will be determined by reference
to the average of the closing prices of Xstrata shares over the
seven dealing days immediately before the shareholder meetings.
-All of the retention awards for the members of Xstrata's
Executive Committee, including the three Executive Directors, will
now be subject to the realisation of additional cost savings
arising from the Merger.
-The previously announced EBITDA synergy estimate of at least
$500 million per annum includes approximately $50 million of cost
synergies.
-Vesting of retention awards for Xstrata's Management will now
only occur if additional cost savings are achieved over and above
the $50 million cost savings already identified in the synergy
estimate.
-Merger-related cost savings will be realised from initiatives
including reorganising the Combined Group's assets, the reduction
of any duplicated costs not already identified in its synergy
estimate, financial synergies and other cost savings.
-For the members of Xstrata's Management other than Mick Davis,
Xstrata plc CEO, up to 50% of the total award will be available to
vest at the first anniversary of the Effective Date.
-Shares at 1352 GMT at 789 pence, valuing the company at GBP23.6
Billion.
-Write to Mark Shapland at mark.shapland@dowjones.com