Simon English: What would you pay for slightly used commodities giant Glencore?

 

Outlook Last May the commodities trading giant and all around company-of-the-future Glencore came to the stock market, turning a private concern into a public company owned by our pension funds and other supposedly savvy investors.

More than a few sages – and a bunch of blokes on the 341 bus through north-east London, who openly know nothing about the commodities market – made the following observation.

If a gang of the most brilliantly smart traders in the history of the world are selling something, that must mean they think we're at the top of the market. Why on earth would you buy?

So far the boys on the bus look like wiser judges than the City.

Glencore floated at 530p. Price last night? 298.3p.

The bankers involved in securing this float would say that they got the best price they could for their client.

You might say that they only get away with such shameless hucksterism because the pension fund managers are investing our money rather than theirs and don't want to create any trouble by appearing to be awkward.

The stock market's present view of Glencore's worth is seriously hindering its bid to takeover Xstrata in an all-share deal.

Qatar Holdings, Xstrata's biggest shareholder outside the staff, say if they are going to get Glencore paper in return for their investment, they shall need much more of it.

Xstrata, until now, has been insisting that the terms of the takeover are fair and good. The £173m that will be paid over time to its top executives, should the deal go through, is incidental. And those executives might be willing to have those payments made in shares rather than cash (that is not them admitting the shares might be worth less than real money. Wash your mouth out).

They have laser-like focus on shareholder value. Pay to the top brass is a side issue.

So it must have been a fly-by-night news source reporting the following yesterday:

"Xstrata wants Glencore to guarantee Xstrata chief executive Mick Davis a position on the board of the new company, with a salary of £9.5m and performance incentives worth 400 per cent of his salary for the first three years."

You really can't trust the BBC.

Whether Qatar will get the terms it says it wants – 3.25 Glencore shares for each Xstrata share rather than 2.8 – is not clear, but plainly it is open to offers. Best of luck.

There's a temptation in some quarters to imagine that the Qataris' intervention here is part of the so-called shareholder spring.

Others are less sure that this shareholder spring has reached Qatar. The Arab spring hasn't even made it to Qatar, says the bloke on the 341.

News
John Travolta is a qualified airline captain and employed the pilot with his company, Alto
people'That was the lowest I’d ever felt'
Life and Style
healthIt isn’t greasy. It doesn’t smell. And moreover, it costs nothing
News
i100

Other places that have held independence referendums
Arts and Entertainment
Pharrell dismissed the controversy surrounding
musicThe singer said 'the last thing I want to do is degrade'
PROMOTED VIDEO
News
news

Sport
footballThe latest scores and Twitter updates from tonight’s games, featuring Bayern Munich vs Man City and Chelsea vs Schalke
News
A male driver reverses his Vauxhall Astra from a tow truck
newsThe 'extremely dangerous' attempt to avoid being impounded has been heavily criticised
News
peopleThe Times of India said actress should treat it as a 'compliment'
Arts and Entertainment
Jack Huston is the new Ben-Hur
film

It scooped up an unprecedented 11 Academy Awards when it was first remade in 1959

News
news

Watch this commuter wage a one-man war against the Circle Line
News
ebooksAn unforgettable anthology of contemporary reportage
Property
Home body: Badger stays safe indoors
lifeShould we feel guilty about keeping cats inside?
Life and Style
fashion

Olympic diver has made his modelling debut for Adidas

Arts and Entertainment
Toby Jones (left) and Mackenzie Crook in BBC4’s new comedy The Detectorists
tvMackenzie Crook's 'Detectorists' makes the hobby look 'dysfunctional', they say
Arts and Entertainment
Maxine Peake plays Hamlet at Manchester's Royal Exchange
theatreReview: Maxine Peake brings emotional ferocity to Shakespeare's starring part
Extras
10 best table lamps
indybest
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Trainee Recruitment Consultant Birmingham

£18000 - £23000 per annum + Comission: SThree: The SThree group is a world lea...

Trainee Recruitment Consultant - Birmingham - Real Staffing

£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...

Recruitment Consultant - Soho - IT, Pharma, Public Sector

£20000 - £25000 per annum + OTE £35,000 first year: SThree: The SThree group i...

Sales Executive

£20 - 24k (Uncapped Commission - £35k Year 1 OTE): Guru Careers: We are seekin...

Day In a Page

Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam
'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

Exclusive extract from Janis Winehouse's poignant new memoir
Is this the role to win Cumberbatch an Oscar?

Is this the role to win Cumberbatch an Oscar?

The Imitation Game, film review
England and Roy Hodgson take a joint step towards redemption in Basel

England and Hodgson take a joint step towards redemption

Welbeck double puts England on the road to Euro 2016
Relatives fight over Vivian Maier’s rare photos

Relatives fight over Vivian Maier’s rare photos

Pictures removed from public view as courts decide ownership
‘Fashion has to be fun. It’s a big business, not a cure for cancer’

‘Fashion has to be fun. It’s a big business, not a cure for cancer’

Donatella Versace at New York Fashion Week