FTSE 100 jumps as Glencore shares rebound

As of 10:21 BST, Glencore’s share price in London had climbed 7.42 percent to 102.05p, though earlier in the session shares had reached as much as 114.45p.


Several parties, ranging from China’s state-backed grain trader COFCO, to Saudi and Singapore’s sovereign wealth funds such as Saudi Agricultural and Livestock Investment Co and GIC, respectively, along with Canadian pension funds like CPPIB, have been mentioned as possible bidders or investors.

The company is actively involved in the reduction of its $30 billion debt, through the sale of assets, reduction in its dividends, and the issuance of further equity.

Glencore shares have been going insane over the past week and the feeling in the City is that Glencore is definitely “in play” – vulnerable to a takeover bid.

The stock was at HK$12.50 after surging as high as HK$18.36.

Mining stocks and commodities were also helped on Monday by data last week that showed US employers added fewer jobs than expected, dimming prospects for an increase in USA interest rates and weakening the dollar. Its shares sank to a record low last week, down 87 percent from when it listed in 2011.

There is an increasing possibility that with the sale of the agricultural unit, the company will be able to reduce its debt significantly.

At its height in 2014, Glencore was worth more than $85 billion after its $29 billion all-share takeover of Xstrata Plc, then the world’s biggest coal exporter.

It is also in talks to sell its metals byproducts business in South America. Chief executive officer Ivan Glasenberg is trying to arrest the slump that’s wiped about $42 billion from the company’s market value this year.


The Daily Telegraph newspaper reported on Monday, without identifying its sources, that Glencore would listen to offers for the whole company, although management doesn’t believe there are buyers willing to pay a fair value in the current market.

Glencore boss Ivan Glasenberg has had a stressful couple of weeks