Market Overview

Glencore Collects $2.5 Billion In Partial Sale Of Its Agribusiness


Glencore International PLC, St. Helier (OTC: GLNCY) announced on Wednesday it has entered into an agreement with Canada Pension Plan Investment Board (CPPIB) to sell a 50 percent stake in its agriculture products business segment.

As part of the agreement, Glencore will sell a 40 percent equity interest in the business for $2.5 billion. The company said that it will use proceeds from the sale to reduce its net indebtedness.

Related Link: Hearing Glencore In Advanced Talks To Sell Up To 40% Of Its AG Unite To CPPIB, Valued At ~$6 Billion

"We are pleased to be partnering with CPPIB as we embark on the next stage of the development of Glencore Agri," Ivan Glasenberg, CEO of Glencore, said. "Under Glencore's ownership the business has been successfully rebased, particularly following the Viterra acquisition in 2012 and is well-positioned to benefit from long-term global macro and sector trends. CPPIB have a proven track record in the sector and share our vision for the future growth of the business through value-creating organic and inorganic growth opportunities for the benefit of all stakeholders. We welcome them aboard and look forward to continuing our good relationship as we work together."

"This is an important day in the evolution of Glencore Agri, and we look forward to working with CPPIB to continue to build the Glencore Agri business over the long-term," Chris Mahoney, CEO of Glencore Agri. "With the investment potential created by this partnership, and given the existing network of high-quality origination, logistics and port assets in key export regions, the business is now well-placed to take advantage of the significant opportunities that are expected to emerge across the sector in the coming years."

Shares of London-listed Glencore were trading lower by nearly 5 percent ahead of the U.S. equity market open.


Related Articles (GLNCY)

View Comments and Join the Discussion!

Posted-In: agribusiness Agricultural Business Canada Pension Plan Investment Board Chris Mahoney CPPIBNews Asset Sales Trading Ideas