Ties to Swiss miner Xstrata may exclude Deutsche Bank and JPMorgan from the $300-$400 million in fees that a listing of Xstrata's part-owner Glencore could yield.

A standoff between Glencore Chief Executive Ivan Glasenberg and Xstrata's Mick Davis -- who has called on JPMorgan's Ian Hannam and Brett Olsher, formerly of Deutsche Bank, for a string of deals -- could force banks to take sides.

The listing may also test the much-vaunted client conflicts policy of Goldman Sachs , which helped Anglo American thwart a bid from Xstrata and is Olsher's new employer.

Conflict of interests are particularly thorny in mining, which is dominated by a handful of huge, acquisitive companies, and has played host to a string of acrimonious bid battles such as BHP Billiton's tilt at Rio and Xstrata's move on Anglo.

Long-time advisers Citigroup , Morgan Stanley and Credit Suisse will be Glencore's lead banks for any initial public offering (IPO), people familiar with the matter say, while a string of rivals are jockeying for secondary roles.

Glencore , the private partnership that is the world's largest commodity trader, briefed equity analysts this week ahead of a possible flotation which Liberum Capital estimates could value it at roughly $60 billion.

A listing is not yet a certainty. Its size, timing, and value are all open questions. But the stakes are indisputably high: a $10 billion listing, for example, could pay $300 to $400 million in fees, Freeman & Co reckons.

It's a huge bonanza at a time when there's virtually nothing going on, said Philip Keevil, a partner at Compass Advisers. Keevil, a former head of European mergers and acquisitions (M&A) at Citigroup, has advised miners including Anglo American and Rio Tinto .

The two firms are intertwined: Glencore owns 34 percent of Xstrata; sold the coal assets that helped create it; markets much of its production; and shares a chairman with the London-listed company.

But while people familiar with the matter say Glasenberg has weighed a merger with Xstrata as an alternative route to the public markets, the idea has been resisted by Davis and Xstrata investors, who wanted a public valuation of Glencore first.

Xstrata should be concerned not to have its core advisers put offside: You don't want to be in a situation where there's nobody able to advise you, because the likelihood is Xstrata will need independent advice down the road, said Keevil at Compass.

Global co-ordinators and bookrunners are in a conflict-rich environment, reading board minutes, talking to management, and so on. It would be difficult for one of the senior banks on the Glencore float to turn round and fairly represent Xstrata in any future transaction involving its parent.

Deutsche Bank and JPMorgan are Xstrata's longstanding corporate brokers and have counselled Davis on almost every major deal or fund-raising.

Each has received nearly $240 million since 2000 from Xstrata for advice on bond and share issues, loans, and takeovers, Thomson Reuters data and estimates show, or 33 percent each of total fees. The next bank down claimed 5.7 percent of the fee pool.

Deutsche, JPMorgan, Goldman Sachs and Xstrata declined to comment.

(Reporting by Quentin Webb and Kylie MacLellan; editing by Alexander Smith)

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