London (Platts)--22Jan2013/531 am EST/1031 GMT

A decision Tuesday by the South African Competition Tribunal to clear the merger between Glencore and Xstrata means the deal now awaits approval from the Chinese competition authorities, Xstrata said.

The Competition Tribunal conditionally approved the merger subject to employment conditions, stipulating that the merged entity should limit retrenchments to a maximum of 80 skilled employees and 100 semi-skilled and unskilled employees.

"Completion of the merger remains conditional upon the receipt of the outstanding regulatory approval in China and completion of the Xstrata court process," as well as Glencore giving effect to the commitments required by the European Commission, Xstrata said in a statement.

In November, the EC said clearance of the merger was conditional on the termination of Glencore's offtake arrangements for zinc in the European Economic Area with Nyrstar, the world's largest zinc producer, and the divestiture of Glencore's minority shareholding in Nyrstar, which currently stands at around 7.79%.

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Shareholders of Xstrata and Glencore voted November 20 in favor of the $31 billion combination of the two Switzerland-based commodities heavyweights, although Xstrata's shareholders rejected a controversial retention bonus plan for the company's senior management.

The deadline for the closing of the merger of Xstrata, the world's fifth-largest metals and mining group, and Glencore, the world's leading metals and thermal coal trader, has been extended for a second time to March 15 from January 31, the companies said last week.

The deadline had previously been extended to January 31 from December 31 on December 10, due to the ongoing regulatory processes in South Africa and China.

Glencore is scheduled to release its preliminary results for the year ended December 31, 2012, on March 5 and both parties have agreed the new long stop date in order to give them the flexibility to complete the merger after the release of the results.

--Andy Blamey, andy_blamey@platts.com
--Edited by Maurice Geller, maurice_geller@platts.com

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