Glencore International, the commodities trader planning the year’s biggest initial public offering, said the share sale in London and Hong Kong this month may value the company at about $61 billion.
Glencore plans to sell shares at 480 pence ($7.90) to 580 pence each, the Baar, Switzerland-based company said today in a statement. The mid-point of the range indicates a market value of $61 billion upon listing, with final pricing due about May 19. Glencore expects the shares to trade in London on May 24.
The company, ending more than three decades of operating as a closely held partnership, may raise about $10 billion in the sale, making it the largest IPO since General Motors (GM) sold stock in November. So-called cornerstone investors agreed to buy about 31 per cent of the shares on offer, Glencore said.
The sale has “one of the largest cornerstone investor participations ever achieved for an IPO,” Chief Executive Officer Ivan Glasenberg said in the statement.
The price mid-point values Glencore at about $52.5 billion before it receives the IPO proceeds, based on 6 billion shares outstanding before the sale. Four analyst reports last month from banks advising on the offering gave an average valuation range of $52.3 billion to $68.7 billion.
‘Good deal’
“We might be towards the lower end of the range,” John Meyer, an analyst at Fairfax IS in London, said in an interview with Mark Barton on Bloomberg Television’s “Countdown”. “A lot of these cornerstone funds have been promised a good deal here and if you price at the top of the range you risk maybe messing that up and breaking that promise.”
As much as 13.9 per cent of the company will be publicly tradable after the IPO.
