Swiss firm counters a friendly offer for Canadian mining group Falconbridge, in which it already holds a 19pc stake Swiss mining group Xstrata launched a hostile takeover bid for Canadian mining group Falconbridge yesterday, countering a friendly offer from Inco of Canada and highlighting consolidation moves in the Canadian mines and metals industry. Xstrata, aiming to create the fifth-biggest mining group in the world, said its offer was worth C$52.50 per share, valuing Falconbridge at C$20 billion ($139 billion). The Swiss-based group said that it already owned 19.8 per cent of Falconbridge and would pay C$16.1 billion in cash to buy the rest of the shares. Falconbridge, which employs 14,500 people worldwide in its predominantly copper and nickel businesses, has already been targeted by Inco, which raised its offer of cash and shares to US$17.6 billion on Saturday. In a sign of further attempts to consolidate the Canadian industry, Inco has also become a target for Canada's Teck Cominco, the world's biggest zinc producer. Teck Cominco has offered US$16 billion for the group with the aim of creating 'a Canadian powerhouse on the world stage'. Metals and mining companies are enjoying booming industry conditions, with prices soaring because of strong demand from China and India and other emerging economies as well as speculative buying from investment funds. The price of nickel struck its highest level on Friday, reaching US$21,876 per tonne - the highest point since the metal was first listed in 1979. Xstrata said that an acquisition of Falconbridge would give it leading positions in copper, nickel, coal and zinc, adding that it saw itself as a 'natural partner' for the Canadian group because of their copper activities in Latin America. The group said it saw no regulatory hurdles to complete the deal because of the limited overlap of the two companies and Xstrata chief executive Mick Davis said that a merger of the companies would create cost savings of US$120 million a year. He also gave assurances about jobs in Canada, where Falconbridge employs 6,500 people, saying cuts would be limited to administrative staff. Xstrata has made a 'commitment' to maintain the entire 1,500 staff of Falconbridge's Sudbury nickel mine in northern Ontario should it win in its bid, he added. Xstrata also stressed that its cash offer for Falconbridge was worth 12 per cent more than the offer by Inco, based on the price of Falconbridge shares on May 5. Xstrata underlined that the Inco offer was a mixture of cash and shares and that the value of the shares component was being inflated by the offer for Inco from Teck Cominco. The Teck Cominco offer for Inco is conditional on Inco abandoning its attempt to buy Falconbridge. 'The board [of Falconbridge] is going to give Inco seven days to make a better offer,' said a spokesman for Xstrata. Announcing an improved offer for Falconbridge on Saturday, Inco had said that both companies had agreed to increase the break-up fee for their deal to US$450 million, making it more costly to disrupt the deal.