Glencore boss fends off fury at his giant dividend

Glasenberg takes £70 million payout but uses it to increase his stake / Pours cold water on hopes he will increase offer for Xstrata / Predicts an Obama election victory as the US economy improves

Ivan Glasenberg, chief executive of the commodities giant Glencore, is to invest his £70m dividend payment back into the company as he sought to fend off anger about exorbitant executive pay. He will instead reinvest the dividend, increasing his stake in a globe-spanning outfit of which he already holds 16 per cent.

Mr Glasenberg, a somewhat controversial head of a business that has faced questions on human rights, also predicted that Barack Obama will win the next US presidential election – as long as unemployment falls – and gave short shrift to those hoping he will increase Glencore's bid for Xstrata.

He was talking as Glencore reported a 28 per cent leap in revenues for 2011 to $186bn (£117bn). The company's profits were up by 7 per cent to $4bn on the back of higher prices for gold, oil and other commodities.

Some of those profits will go to shareholders in the form of a final dividend of 10 cents a share, of which the Glencore chief's share would be nearly £70m. Mr Glasenberg said he intends to put that money back into the company, as he did with an earlier payment.

Asked if he understood public anger at executive pay, he replied: "I am a big owner of this company.

"Yes, I do get a dividend, but I have forfeited any bonus. I am not taking any long-term bonus.

"I have been part of this company for 28 years. We brought it to the market. Shareholders expect us to give a dividend, otherwise they can't be expected to invest in the business."

He said that taking no bonus shows that "I am purely working for the benefit of shareholders".

While those investors – the top seven are all executives – will be pleased at the dividend, the shares have not performed well.

Floated last summer at 530p, a price that some said indicated the top of a commodities bubble, they were yesterday down 16.65p at 403.35p.

It is not yet clear what the other executives, such as the London-based British boss Alex Beard, will do with their windfalls. Beard's stake is worth more than £1bn. Today's divi fetches £20m.

They may come under pressure to follow the boss's lead and reinvest the dividend payments.

Mr Glasenberg is also trying to force through a $90bn merger with rival Xstrata. Glencore is offering 2.8 of its own shares for every Xstrata share, a price some Xstrata shareholders say is not enough to win their vote.

Questioned whether the amount of cash Glencore has to play with might encourage Xstrata shareholders to up their demands, he said: "Sure everyone can ask for more. Whether we are prepared to pay more is a different story."

Sounding as though he was firmly opposed to increasing the bid, he said: "Why should there be a premium? If it was a cash deal, I would understand them looking for a big premium. It is not a cash deal. Why would shareholders go against the board of Xstrata?"

On the wider economy, he was mostly optimistic.

"America is kicking along better than anyone expected. China continues to grow, commodities are looking strong," he said. "The big question is Europe."

Mr Glasenberg offered that he expects President Obama to get a second term in the White House as long as US unemployment starts to fall.

A vote on the Xstrata deal is still some months away, although Mr Glasenberg intends to meet the company's shareholders soon.

Two of them, Standard Life and Fidelity, have already said that they want a fresh offer, suggesting they do not believe it is a "merger of equals" as Glencore argues.

Other investors

Daniel Mate
Stake 15.8%
Divi payment £26m

Aristotelis Mistikadis
Stake 6%
Divi payment £25m

Tor Peterson
Stake 5.95%
Divi payment £23m

Alex Beard
Stake 5.29%
Divi payment £20m

Gary Fegal
Stake 4.63%
Divi payment £15m

Chris Mahony
Stake 2.08%
Divi payment £9m

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

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

iJobs Job Widget
iJobs Money & Business

Guru Careers: Tax Manager / Accountant

£35 - £50k DOE: Guru Careers: A Tax Manager / Accountant (ACA / CA / CTA) is n...

Ashdown Group: Contracts Executive - City of London

£35000 - £37000 per annum + benefits: Ashdown Group: Contracts Executive - Cit...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45K: SThree: SThree Group have been well esta...

Recruitment Genius: Call Centre Debt Collector - Multiple Roles

£21000 per annum: Recruitment Genius: This is an exciting opportunity to join ...

Day In a Page

Giants Club: After wholesale butchery of Idi Amin's regime, Uganda’s giants flourish once again

Uganda's giants are flourishing once again

After the wholesale butchery of Idi Amin's regime, elephant populations are finally recovering
The London: After 350 years, the riddle of Britain's exploding fleet is finally solved

After 350 years, the riddle of Britain's exploding fleet is finally solved

Archaeologists will recover a crucial item from the wreck of the London which could help shed more light on what happened in the vessel's final seconds
Airbus has patented a jet that could fly from London to New York in one hour

Airbus has patented a jet that could fly from London to New York in one hour

The invention involves turbojets and ramjets - a type of jet engine - and a rocket motor
Tate Sensorium: New exhibition at Tate Britain invites art lovers to taste, smell and hear art

Tate Sensorium

New exhibition at Tate Britain invites art lovers to taste, smell and hear art
10 best sun creams for kids

10 best sun creams for kids

Protect delicate and sensitive skin with products specially formulated for little ones
Ashes 2015: Nice guy Steven Finn is making up for lost time – and quickly

Nice guy Finn is making up for lost time – and quickly

He was man-of-the-match in the third Test following his recall to the England side
Ashes 2015: Remember Ashton Agar? The No 11 that nearly toppled England

Remember Ashton Agar?

The No 11 that nearly toppled England
Turkey-Kurdish conflict: Obama's deal with Ankara is a betrayal of Syrian Kurds and may not even weaken Isis

US betrayal of old ally brings limited reward

Since the accord, the Turks have only waged war on Kurds while no US bomber has used Incirlik airbase, says Patrick Cockburn
VIPs gather for opening of second Suez Canal - but doubts linger over security

'A gift from Egypt to the rest of the world'

VIPs gather for opening of second Suez Canal - but is it really needed?
Jeremy Corbyn dresses abysmally. That's a great thing because it's genuine

Jeremy Corbyn dresses abysmally. That's a great thing because it's genuine

Fashion editor, Alexander Fury, applauds a man who clearly has more important things on his mind
The male menopause and intimations of mortality

Aches, pains and an inkling of mortality

So the male menopause is real, they say, but what would the Victorians, 'old' at 30, think of that, asks DJ Taylor
Man Booker Prize 2015: Anna Smaill - How can I possibly be on the list with these writers I have idolised?

'How can I possibly be on the list with these writers I have idolised?'

Man Booker Prize nominee Anna Smaill on the rise of Kiwi lit
Bettany Hughes interview: The historian on how Socrates would have solved Greece's problems

Bettany Hughes interview

The historian on how Socrates would have solved Greece's problems
Art of the state: Pyongyang propaganda posters to be exhibited in China

Art of the state

Pyongyang propaganda posters to be exhibited in China
Mildreds and Vanilla Black have given vegetarian food a makeover in new cookbooks

Vegetarian food gets a makeover

Long-time vegetarian Holly Williams tries to recreate some of the inventive recipes in Mildreds and Vanilla Black's new cookbooks