15th Sep 2015 16:14
LONDON (Alliance News) - Glencore PLC on Tuesday said it plans to place up to 1.31 billion new shares, equivalent to up to 9.99% of its existing shares in issue, with institutional investors, as it looks to cut debt and strengthen its balance sheet to cope with weak commodity prices.
Shares in Glencore closed up 0.1% at 128.05 pence on Tuesday, making the offering worth GBP1.68 billion at market prices.
The equity fundraising was first revealed just over one week ago as part of a plan that also included suspension of its final dividend for 2015 and interim dividend for 2016. The move was welcomed by investors, as concern had mounted about Glencore's USD30.0 billion debt pile. Glencore has said it wants to raise up to USD2.5 billion in equity.
In a statement, the commodities company said 78% of the new shares will be allocated through an accelerated bookbuild placing, with the remaining 22% to be subscribed for by senior managers at Glencore, including Chief Executive Ivan Glasenberg and Chief Financial Officer Steven Kalmin.
They will subscribe for shares at a price to be determined by the accelerated bookbuild process.
Citigroup Global Markets Ltd and Morgan Stanley & Co International PLC are the joint bookrunners on the placing, with Barclays Bank PLC named a co-bookrunner.
Linklaters LLP is providing legal advice to Glencore.
By Samuel Agini; [email protected]; @samuelagini
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