Fri, May 20, 2011 - Page 10 News List

Glencore raises US$10 billion through IPO

AFP, ZURICH and SAN FRANCISCO

Swiss commodities giant Glencore said yesterday that it had raised about US$10 billion through its initial public offering (IPO) at the London and Hong Kong stock markets, an operation that it described as a success.

The stock market listing values the Baar, Switzerland-based group at about US$59.2 billion and marks the biggest IPO so far this year.

“Glencore’s offer has seen substantial interest from investors around the world and was significantly oversubscribed throughout the price range providing Glencore with a high quality, diverse and geographically spread investor base,” Glencore chief executive officer Ivan Glasenberg said.

Admission and full dealing in the shares will begin on Tuesday in London and Wednesday in Hong Kong.

Glencore, the world’s biggest commodities trader by revenue with US$145 billion last year, has secured US$3.1 billion from so-called cornerstone investors, including sovereign wealth funds in Singapore and Abu Dhabi, asset managers and private banks, according to media reports.

The company has confirmed that it had reached agreements with “certain cornerstone investors” who have already accepted to subscribe for 31 percent of the shares on offer, worth US$3.1 billion.

The group has said it would use funds raised by the listing to pay down debt, boost its stake in Kazzinc, a zinc producer with core operations in eastern Kazakhstan and finance other projects to expand its business.

Separately, LinkedIn said on Wednesday that its stock would debut at US$45 per share in a move that valued the career-focused social networking firm at more than US$4 billion.

The first major US social networking firm to go public, LinkedIn jacked up its IPO share price for 7.84 million shares to US$45 just a week after it had set an original target of US$32 to US$35 per share.

The sale could bring in more than US$354 million and see the shares trading on the New York Stock Exchange as early as yesterday.

In case of high investor demand, the company has set aside an additional 1.18 million shares for offering that could raise the take to US$406 million.

LinkedIn, whose members cultivate and manage their careers and business networks online, initially set a target of US$175 million when it registered for its IPO with the US Securities and Exchange Commission in January.

The California startup launched in 2003 said its wants the money to fuel expansion.

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