Glencore to Invest $1 Billion in Peruvian Mining Company Volcan Compañia Minera
03 Outubro 2017 - 3:07PM
Dow Jones News
By Scott Patterson
LONDON -- Glencore PLC said it would to invest nearly $1 billion
in a Peruvian zinc operation, another sign the Swiss mining and
trading giant is opening its cash hoard for acquisitions as
rebounding commodity prices refill its coffers.
The investment in Peruvian mining company Volcan Compañia Minera
S.A.A. will add to Glencore's world-beating zinc assets. Glencore
is the world's leading miner and trader of zinc, an essential metal
for making steel, owning a position big enough already that the
company's decisions can move prices.
Soaring zinc prices, buoyed in part because of the firm's 2015
decision to shut down about 4% of global zinc production, have
boosted Glencore's profits this year.
Glencore said Tuesday it had already struck agreements with
shareholders of Volcan to purchase 27% of its class A shares for
$531 million. It said it is making an offer to all Volcan
shareholders for up to 48% of its class A shares, which would put
its total holdings of class A shares as high as 66.3%.
Including class B shares, Glencore, an investor in Volcan since
2004, will hold between 19% and 28% of the company following the
investment, which it expects to complete by November or
December.
The total amount payable by Glencore, depending on shareholders'
response, will be between $531 million and $956 million, the
company said. The investment will be paid out of existing cash
resources, it said.
Volcan is "one of the world's largest producers of zinc, lead
and silver, " according to the company's website.
Glencore, led by mining-deal maven Ivan Glasenberg, has been
more focused on acquisitions during the recent recovery in
commodities than most of its competitors.
Glencore inked a $1.1 billion deal in July for a stake in
Australian coal assets and considered a bid for $11 billion grain
trading company Bunge Ltd. In February, Glencore agreed to pay $531
million in cash to acquire stakes in two African copper
projects.
Glencore's shares have surged more than 400% since they plunged
in 2015 as investors worried that falling commodity prices, sparked
by an economic slowdown in China, would lead to downgrades from
credit-ratings firms.
Rebounded prices for copper, cobalt, zinc, coal and other
commodities have provided much needed cash to Glencore and other
mining companies, letting them pay down debt, reinstate dividends
and, increasingly, look to do deals.
Write to Scott Patterson at scott.patterson@wsj.com
(END) Dow Jones Newswires
October 03, 2017 13:52 ET (17:52 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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