John Parker, who is to step into chairperson position for Anglo American Plc as of August 1st this year, has rejected a merger proposal from Xstrata. Since the proposal has been made public, both firms experienced an increase in share prices, with Anglo's shares rising by 12 percent and Xstrata's by 4 percent, reports Mining Weekly.



John Parker had dismissed the proposal as impractical, mostly due to conflicting management styles and objectives for the two companies – the Anglo-American and the Anglo-Swiss. While Anglo American is centered around a strong head office, Strata operates through a few, relatively independent, centers. Parker explained "Mergers that look good on paper can often be tripped up by cultural and management differences between companies."



Anglo American Plc's objective of cutting costs by $2 billion in the next two years stands in objection of Xstrata's merger proposal, which is projected to add a $1 billion expense as a result of restructuring both companies, reports Mining Weekly.