Friday June 19, 02:30 AM
Commodities giant Glencore mulls flotation - FT
LONDON, June 19 (Reuters) - Glencore, the giant Swiss-based commodities trader, is exploring a stock market listing to overcome the financial constraints of its private ownership structure, the Financial Times reported on Friday.
Citing 'a person familiar with the company', the newspaper said that Glencore, which has expanded from commodity marketing to investments in production and processing and owns over a third of UK-listed miner Xstrata (LSE: XTA.L - news) , was in initial talks with bankers about a flotation.
'It is all about finding the right time,' the FT quoted an unnamed banker as saying.
The FT said that some close to the group viewed its private structure as inefficient and a barrier to growth. It added that any deal was more likely in the medium term, once commodities prices had improved further.
The FT said that Glencore had declined to comment on its report, and the Switzerland-based firm was not immediately available for further reaction.
Glencore had revenue of $152 billion in 2008, up from $142 billion in 2007, while earnings before interest, tax, depreciation and amortisation (EBITDA) fell to $4.4 billion from $5.5 billion, the FT said, citing data from Standard & Poor's.
As a private company, Glencore does not make its financial results available to the general public.
But the problems of Glencore's low-profile and publicity-shy approach had become apparent in the last quarter of 2008 when the cost of insuring against default on its debt jumped 16-fold as investors speculated about the company's liquidity, the FT said.
As well as Xstrata, Glencore also holds major stakes in Century Aluminum in the United States and Australia's Minara Resources.
(Reporting by David Milliken and Jan Dahinten in Singapore) Keywords: GLENCORE/
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