Morning business round-up: Xstrata Glencore confirm deal

Mining firm Xstrata has formally announced plans to merge with Glencore, the world’s biggest commodity trader.

The newly merged firm would be worth $90bn (£56bn), of which Xstrata would comprise $39bn.

But two major Xstrata shareholders say they will vote against the deal as they say it undervalues their shares.

Xstrata chief executive Mick Davis will head up the new firm, with Glencore’s Ivan Glasenberg becoming deputy chief executive.

A Greek exit would not end the euro, said European Commission Vice President Neelie Kroes in an interview with a Dutch newspaper.

She said there would be “absolutely no man overboard” if Greece left the euro.

Pressure is rising on Greece’s national unity government to agree tough reforms demanded by the country’s lenders.

The EU, IMF and European Central Bank have made further spending cuts, labour market reforms and bank rescues a condition of extending a new bailout.

Toyota, the world’s third largest carmaker, saw profits rise over the whole of 2011 and said its recovery was on track following the impact of the Japanese tsunami, Thai floods and the strong yen.

The firm increased its annual sales forecast to 7.41 million vehicles.

The firm has started a second shift at its US plant in Mississippi, where it makes the Corolla, as it ramps up production.

In 2011, Toyota lost its crown as the world’s largest car maker. Its total sales of 7.95 million vehicles – down 8% – put it behind General Motors, with 9.03 million and Volkswagen with 8.16 million.

Profits at UBS have slumped by 76% in its latest quarterly results.

The investment bank reported a 256m-franc ($430m; £270m) loss for the quarter, mainly due to weak client business during tough trading conditions last autumn when markets feared Italy might be pushed into default.

Business levels fell both at its key wealth management unit, as well as at its struggling investment bank.

As the eurozone debt crisis rumbles on, the Swiss bank warned that business in the coming three months was also likely to disappoint.

The company that owns the KFC fast food chain has reported solid growth fuelled by demand in China, a trend that is ongoing for Yum! Brands.

The firm has reported better-than-expected profits of $356m for the fourth quarter of 2011, jumping 30% from the same period last year.

The company’s sharp profit rise was tempered by an increase in food and labour costs in China.

Yum! Brands says the Chinese market is crucial to its success.