Glasenberg – 1, Xstrata shareholders – 0

Oil and natural gas rich Qatar has upped its stake in Xstrata, currently negotiating a $90 billion merger with Glencore International, to just over 5%, making the country's sovereign wealth fund the diversified miner's third largest shareholder.

Swiss commodities giant Glencore already owns 34% of Xstrata. Glencore is offering 2.8 shares for every one of Xstrata, but aside from second largest shareholder BlackRock, other institutional investors have threatened to block the deal.

The Qatari investment should provide Glencore CEO Ivan Glasenberg the necessary backing he needs to push through the deal. Glasenberg and Xstrata CEO Mick Davis have embarked on a roadshow to sell the deal. 75% of shareholders must vote in favour of the deal.

The Brisbane Times  talked to some of Xstrata's unhappy investors whom have all along said the terms are unfair to Xstrata:

"It makes us feel very uneasy to see the appearance of this sovereign wealth fund on the shareholder register," Schroders fund manager Richard Buxton said.

"It almost certainly means votes are in the bag for Ivan [Glasenberg]."

Other fund managers, who asked not to be named, said they were concerned it was some kind of "stitch-up" that would push the deal through despite widely unpopular terms. "Under the current structure, we will vote the deal down and we won't be alone," one top-10 holder in Xstrata said.

"It won't make a blind bit of difference to the fact that Xstrata is being sold far too cheaply and that the exchange ratio is wrong," a top-five investor said.

Reuters reports "regulatory filings showed that the Qatar Investment Authority (QIA) built up its Xstrata holding, worth $2.65 billion at current prices, through stock market transactions from around 3 per cent when Glencore announced its bid."

Those holding out for a sweetener – something Glasenberg has repeatedly rejected – point to the fact that growth prospects for Xstrata is much healthier than Glencore.

Xstrata is the world’s biggest exporter of thermal coal and the fourth-largest copper producer and in the decade under Davis has gone from having a fewer than 2,500 employees to a workforce exceeding 70,000 in 20 countries.

A combined Xstrata and Glencore would have revenues in excess of $100 billion with as much as 80% of sales earned from mining.

Even before building up Xstrata through a series of billion dollar transactions, Davis was a formidable dealmaker who with fellow South African Brian Gilbertson created Billiton. Davis left for Xstrata after Billiton was sold to BHP in 2001.

Glasenberg and Davis both cut their teeth in their native South Africa’s coal industry in the 1980s.

Glasenberg is no slouch when it comes to buying up companies either. At the end of March Glencore snapped up Canada’s grain handler and agricultural retailer Viterra for $6 billion.

While the shareholder tussle is good to watch the deal could still be scuppered by European regulators.

The Wall Street Journal reported in March that steelmakers and other European players "raised fears that the deal could create too powerful a player" in the market for zinc, nickel and coal. The whole vetting process could take until early 2013 the paper said.