How do you make a £2bn fortune from commodities? Answer: start with a £6bn fortune.
Ivan Glasenberg, chief executive of Glencore, won’t be laughing. Those numbers are the value of his shareholding in the mining and commodity-trading company at flotation in 2011 and now. Yes, Glencore’s share price really has fallen by two-thirds, from 530p to 180p, since it came to market with a fanfare. Among London’s big miners, only Anglo-American has done worse.
This week alone the fall has been 10% as the China-inspired rout has run through commodity markets and mining stocks. Glencore is being whacked harder than the likes of BHP Billiton and Rio Tinto for a simple reason – relative to earnings, it has a lot more debt.
At the IPO in April 2011, GIC took US$400m worth of shares, the second largest stake. The fund had already invested in Glencore through a convertible bond issued in 2009. At IPO time GIC was way ahead given that since the IPO had a market cap of US$62bn, it made a killing on its 2009 investment. https://atans1.wordpress.com/2011/04/15/gic-has-a-winner-with-glencore/
Update on @0August :