Mining Journal > Finance > Glencore CEO studying M&A, not bidding for ENRC

Glencore International plc, the largest listed commodity trader, said it regularly studies merger and acquisition opportunities, and isn’t planning a bid for Eurasian Natural Resources Corp.

“Glencore monitors a wide range of opportunities in the sector and we will continue to do so,” Chief Executive Officer Ivan Glasenberg, 54, said today on a call with reporters.

“Although we talk to a lot of people in the sector we are not currently, actively considering a bid for ENRC.”

ENRC, a producer of metals in Kazakhstan, advanced the most in seven months in London trading yesterday after the Sunday Times reported that Glencore was studying a £12 billion-pound (US$19.7 billion) takeover offer. The Kazakh government is unlikely to approve a bid for ENRC by Glencore, Collins Stewart plc analysts said yesterday.

“The press are ahead of themselves and speculating a lot,” Glasenberg said today of the report. “It’s not our intention to do hostile takeovers of publicly-listed companies. I’m not saying we’d never do a hostile takeover, but it’s really not our intention. We’d rather do things opportunistically.”

Glencore today said net income adjusted for items rose to US$1.3 billion in the first quarter from US$886 million a year earlier. The stock declined as much as 2.2% to 512 pence in London trading, and was at 512.1 pence as of 8:37 a.m. local time. ENRC dropped 1.1% to 768 pence.

A full cash-bid for ENRC in the near-term is “highly unlikely” and Glencore is unable to issue new shares for at least six months, Miriam Hehir, an RBC Capital Markets analyst in London, said yesterday.

Glencore completed a US$10 billion initial public offering last month, selling stock in London and Hong Kong in the world’s biggest IPO this year. Glasenberg said today that the Baar, Switzerland-based company had signed an initial accord to acquire a Peruvian copper project belonging to Hong Kong-based CST Mining Group Ltd.

CST said earlier that Glencore had signed an initial agreement for 70% of the Mina Justa copper project for US$475 million. The company is also studying acquiring iron-ore mines, Glasenberg said.

June 14 (Bloomberg)