Xstrata increases offer for Falconbridge:

Swiss mining company Xstrata has increased its takeover offer for Canadian nickel producer Falconbridge to $59.00. The all cash offer is only slightly higher than the current competing bid by Inco. The Inco offer is a combination of stock and cash currently stands at approximately $58.00.

The consolidation in the global base metal mining business is heating up as the major players try to diversify their production into different metals in the belief that metal prices will remain at elevated levels longer term.

The Inco bid has been enhanced by the offer for both Inco and Falconbridge by Phelps Dodge. The Phelps bid is valued at approximately $80.00 a share for the combined Inco/Falconbridge but is not dependent on Inco acquiring Falconbridge.

This story is only part way through as Inco is very likely to top the Xstrata bid with assistance from Phelps Dodge. Stay tuned.