Glencore Will Buy Back Prodeco Coal Mines Assets From Xstrata Mining Company

Glencore is a mining company that operates mines Prodeco. Prodeco coal mines located in the territory of Colombia. Prodeco mining assets sold to Xstrata in January, when the weakened financial companies.

Prodeco sales of $ 2 billion are allowed to subscribe to Glencore rights issues Xstrata, the London listed global miner where Glencore has a 34 percent stake.

Since then, Xstrata has Prodeco important for financial recovery. Assets alone Xstrata lifted production of coal, the most profitable commodity, the company's first quarter and third quarter.

Along with improving corporate financial, mining companies plan to buy back the coal mines of Xstrata Prodeco.

Glencore can make a call option to buy back Prodeco for $ 2.25bn before March 4. But before the third-quarter earnings reports remaining concerns that the buy-back, even if affordable, not in the interests of improving the value of Glencore credit.

Miriam Hehir, a credit analyst at RBC Capital Markets in London, gave a statement "We're hoping to buy back from Glencore related Prodeco Xstrata options before ending in early March. The minimum price was $ 2.25bn, but we could see it again changed hands for several hundred million on top of this, Glencore could reduce the need for funds associated with the minority partners may be involved, or disposal elsewhere.