3rd May 2016 17:30
LONDON (Alliance News) - Glencore PLC is looking at the potential of selling its biggest gold mine as the multi-commodity miner steps up its plan to offload assets in order to reduce its debt, the Financial Times reported Tuesday.
Citing people familiar with the sales process, the FT said Glencore was looking to sell the Vasilkovskoye project in Kazakhstan for up to USD2.00 billion, with Chinese miners expected to lead the charge.
Glencore decided to consider a sale after being approached by several suitors, and has appointed BMO Capital Markets and Deutsche Bank to handle a possible deal, the FT reported.
http://www.ft.com/cms/s/0/3ef63bb4-112d-11e6-91da-096d89bd2173.html#axzz47c954idN
The deal would be part of Glencore's wider plan to get net debt below USD18.00 billion by the end of the year and below USD15.00 billion at 2017-end from the USD25.88 billion reported at the end of 2015, and the company is on its way after striking a series of deals recently.
Glencore agreed to offload a substantial 40% stake in its agricultural business to a Canadian pension fund in a deal to Canada Pension Plan Investment Board for USD2.50 billion last month, and has suggested a further stake could be offloaded in the future.
Glencore is targeting USD4.0 billion to USD5.0 billion in asset sales this year and needs to raise between USD1.50 to USD2.50 billion more from asset sales in order to hit that target.
The company has already confirmed that it has received bids for the two copper mines it is looking to sell, Lomas Bayas in Chile and Cobar in Australia, and a deal is expected to be revealed during this current quarter.
Analysts have previously said the Vasolkovskoye gold mine and the company's rail assets in Australia could also be sold off, supporting the potential sale reported by the FT on Tuesday.
Glencore shares closed down 4.6% to 155.49 pence per share on Tuesday.
By Joshua Warner; [email protected]; @JoshAlliance
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