Glencore's £37bn flotation set to create five billionaires overnight

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The Independent Online

Five executives of the Swiss commodities giant Glencore are set to see their personal wealth rocket into the billions when it lists on the stock market later this month.

The figures emerged as the trader laid the ground for a strong market debut yesterday with a pricing range of 480p to 580p per share, which, assuming the stock is ultimately priced at the mid-point, values the business at nearly £37bn. Conditional trading is set to begin on 19 May, with the company on track to secure a berth in the FTSE 100 index.

The dual London and Hong Kong float could see chief executive Ivan Glasenberg, a publicity-shy former coal trader, end up with a 15.8 per cent stake worth £5.8bn.

Glencore's prospectus also showed that the heads of its zinc, copper and lead businesses, Daniel Badenes and Aritotelis Mistakidis, could end up with shareholdings worth more than £2bn each, while Tor Peterson, head of Glencore's coal and coke department, could end up sitting on a stake worth £1.9bn after the listing. Alex Beard, who runs the firm's oil arm, could be in line for a 4.6 per cent stake worth £1.7bn after the company goes public.

The chief financial officer, Steven Kalmin, who will own 1 per cent immediately following admission, does not make the billionares' list with a stake worth around £370m. The figures assume that stock is priced at the mid-point, and are subject to other moving parts, including that the over-allotment option is not exercised.

Alongside figures on major shareholders, the hitherto secretive trading house also published pay details for its revamped board.

Mr Glasenberg and Mr Kalmin, are on annual salaries of £925,000 and £700,000 respectively, while the non-executive chairman Simon Murray's yearly fees stand at £675,000.

Tony Hayward, the former chief executive of BP who was forced to resign from the oil giant after public missteps in the wake of the Gulf of Mexico oil spill, is being paid £158,000 a year as Glencore's senior non-executive director. He is also on a number of board committees – including the company's environment, health and safety committee.

Historically, Glencore has been entirely owned by its employees. By pricing the offering at a lower level than anticipated by some analysts, it was seen as paving the way for a strong performance after its initial public offering, something that would make sense given that the vast majority of the listed firm will remain in the hands of employees.

"The existing shareholders are mostly staying, so if they believe in the value of the company, they should be happy to see the share price rise rather than trying to get the full value at the point it lists," Collins Stewart's analyst John McGloin said.

The float is backed by a number of "cornerstone investors", who between them will take up about 31 per cent of total offer.

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