Glencore and Xstrata, set to create a $90 billion mining powerhouse, have placed iron ore at the top of their post-merger-to-do list, as the companies are looking to increase their holdings of the commodity in the near future, Reuters reported.
According to the news outlet, the two companies are looking for a repeat of the success that they had in acquiring a significant amount of coal, as their reporting showed that this push was successful.
Reuters reported that this new goal for the two companies may be a harder one to achieve, as other major miners hold significant supplies of the commodity and make up a large share of the earnings at giants like Anglo American, Rio Tinto and BHP Billiton.
“When I was in the coal mining business, people told me it was too late to develop the coal business because it was already owned by the majors and there wasn’t a way in,” Glencore Chief Executive Ivan Glasenberg told Reuters. “There is always a way in, there will be opportunities, you just have to find them. Today with the amount of iron ore opportunity in Africa, and development in Africa, it is definitely not too late.”
The Guardian reported that the two companies have set out on a quest to obtain more investor funding for new projects, as their merger, which was initially called a takeover, had led to the combination of both company’s resources. However, a majority of the executive positions will go to Xstrata employees.
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