Glencore issues mammoth $5bn bond offering

Suzie Neuwirth
MINING and commodities trading giant Glencore Xstrata yesterday announced the launch of a huge $5bn (£3.3bn) bond, its debut as a merged company.

The firm sold five separate tranches of debt, including $1bn worth of notes due in May 2016 at a 1.7 per cent yield, $1.5bn of 2.5 per cent notes due January 2019, and $1.5bn of 4.12 per cent notes that mature in May 2023. It also sold a range of three- and five-year floating rate notes.

The proceeds from the guaranteed notes will be used to repay outstanding debt and for general corporate purposes, the company said.

The company has not been short of activity since its merger mere weeks ago.

Just last week Glencore Xstrata shareholders appointed former BP chief executive Tony Hayward as interim chairman of the group, ousting industry veteran John Bond from the role sooner than anticipated.

The shareholders also ousted all remaining former Xstrata directors from the board, with Paul Renken, mining analyst at VSA Capital, commenting that “this is definitely a Glencore-managed company now.”

Earlier this week, the European Commission is understood to have asked Glencore and a number of other commodities trading houses to submit information relating to its probe into allegations of oil price fixing, although there is no suggestion that they are under investigation.

The long-feted merger between the miner Xstrata and the commodities trader Glencore is the largest in mining history.