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Johannesburg - Glencore sold bonds for the first time since a rout in commodity markets forced it to trim debt and sell assets.
The miner and trader run by billionaire CEO Ivan Glasenberg sold $257m of securities due in May 2021, according to data compiled by Bloomberg. Its last debt sale, in yen, was about a year ago.
“That’s definitely a positive as the company demonstrates it has access to longer-term funding,” said Max Mihm, a Frankfurt-based portfolio manager at Union Investment, which holds Glencore bonds among its $295bn of assets as of December. Still, the debt is “expensive relative to past years,” Mihm said.
Glencore’s return to the bond market underscores improving sentiment in metals and mining, which has helped boost shares in the Bloomberg World Mining Index by 49% since touching a 12-year low in January. The company has bolstered its balance sheet by selling and closing mines around the world and won a vote of confidence from lenders when it refinanced an $8.45bn revolving-credit facility in February.
An official at Glencore confirmed the bond sale. The company’s shares fell 0.5% to 151.3 pence as of 10.17 in London.
The notes sold Tuesday priced to yield 279.5 basis points more than benchmark rates, according to data compiled by Bloomberg. Glencore last sold Swiss franc-denominated bonds in November 2014, when it issued 500 million francs of notes due December 2020 priced to yield 95 basis points more than benchmark rates, the data show.
