Commodities trader Glencore reported better-than-expected results on Tuesday, and seemed to stick to its guns over the pricing of its $30 billion bid for miner Xstrata.
Ivan Glasenberg, chief executive of Glencore, told reporters that the deal was not a "must-do" for the company at the moment, and it could return to the offer in the future.
He added that he "cannot understand" demands for a higher price from Qatar Holdings, a major Xstrata shareholder. The current offer is for 2.8-times earnings and Qatar wants 3.25-times earnings.
Glasenberg's remarks are the latest sally in a game of brinkmanship between Xstrata's two biggest investors.
Glencore reported adjusted earnings of $2.5 billion for the first half, a 25 percent fall from the same period in 2011, but better than the $2.4 billion forecast by an average of analysts' estimates. Pre-exceptional net income was $1.8 billion, down 26 percent, but it beat predictions of $1.6 billion. Its dividend was raised by 8 percent to $5.40 per share.
Shares in Glencore rose around 1.3 percent at the start of London trading after the results were announced.
Its earnings were hit by weaker commodity prices, particularly for copper, lead and zinc, and lower profits at Xstrata and Katanga mining. It owns substantial stakes in both companies.
The swings of commodity markets are not a surprise. What investors particularly wanted to hear about is whether there'll be any concessions on the price offered for the shares of Xstrata it doesn't own.
Glencore management said only that the deal is still "in progress" in a statement.
Analysts at Macquarie said in a recent note that Glencore shouldn't pay more than 2.9- to 3-times earnings. Recent disturbances at miner Lonmin, which is 25 percent owned by Xstrata, will not have softened Glencore's position.
Xstrata shareholders will meet to vote on the offer on September 7th. There have also been shareholder concerns about hefty pay packages to persuade Xstrata management to stay on post-merger.
Glasenberg said in a statement: "We neither anticipate nor assume any material improvement in overall market or economic conditions in the near term. We will continue to diligently look to our own growth pipeline and end markets to maximize performance for our shareholders."
CORRECTION: An earlier version of this story said Glencore's bid for Xstrata was worth 30 billion pounds. It is in fact worth $30 billion.