Share dealing values Glencore at £36bn

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The Independent Online

Commodities giant Glencore has been valued at more than £36 billion after dealings in London's biggest stock market listing got under way today.

Chief executive Ivan Glasenberg is set to see his personal stake worth almost £5.8 billion, while 485 traders now sit on paper fortunes of several tens of millions.

The shares were issued at 530p at the start of trading and made steady if unspectacular progress in subsequent conditional dealings.

The Switzerland-based commodities trader conservatively pitched its price at the bottom of indications yesterday, even though the float was said to be more than four times over-subscribed by institutional investors,

It sold just over 16% of its total shares in the issue, about 1.14 billion. Retail investors will not get a chance to participate until next Tuesday.

Glencore is the world's biggest commodities trader, with products including oil, coal, gold and foodstuffs, but also owns a number of mines worldwide. It employs around 57,500 staff around the world, of whom around 200 are based in London.

Founded by US tycoon Marc Rich in 1974 and owned by its traders since a management buyout in 1994, the group holds a 34% stake in miner Xstrata, as well as having a 9% holding in Russian aluminium giant Rusal.

Glencore is set to enter the FTSE 100 on Tuesday, making it only the third company to enter the blue-chip index immediately on listing, and will add to the growing dominance of mining groups in the top flight.

Mr Glasenberg said the offer was significantly oversubscribed, providing Glencore with a "high quality, diverse and geographically-spread investor base".

The final price of 530p was set to encourage investors to take a long-term view, he said.

The group, which raised nearly £5 billion in new money from the listing, is expected to use its new cash and its shares to fund a buying spree.

Mr Glasenberg has already indicated he wants to use the firm's new status as a listed company to make "opportunistic" acquisitions.

Analysts have suggested that could mean a bid for the outstanding shares in mining group Xstrata, which is currently worth more than £40 billion.