Glencore up on rumours of unit sale

The logo of Glencore is pictured in front of the company's headquarters in the Swiss town of Baar. File picture: Michael Buholzer

The logo of Glencore is pictured in front of the company's headquarters in the Swiss town of Baar. File picture: Michael Buholzer

Published Oct 5, 2015

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Hong Kong - Shares in mining giant Glencore soared 33.64 percent in mid-afternoon trade in Hong Kong, following reports it is in talks to sell its agriculture business.

Shares in the Swiss-based firm have fluctuated wildly amid investor fears that sinking commodity prices will affect its ability to meet outstanding debt obligations.

Singapore's sovereign wealth fund, Japanese trading house Mitsui & Company, and a Canadian pension fund are among potential buyers, Bloomberg News reported.

The firm plunged in trading last week after brokerage Investec questioned its future if commodity prices - which are wallowing at multi-year lows owing to weak demand from a slowing China - fail to recover soon.

Most resources-linked firms have taken a hit in recent months as the price of copper, aluminium, iron ore and oil have tumbled.

But Glencore has been particularly badly affected because of its huge $30 billion debt load, even after the firm this month raised $2.5 billion via a shares sale as part of a vast plan to rejig its finances.

AFP

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