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Under the control of US justice, a commodity company invests $ 1 billion in the purchase of its own shares. Meanwhile, more and more investment companies are avoiding the purchase of securities from major fossil fuel producers.
A worker in the Congolese province of Katanga controls copper plates. (Image: Simon Dawson / Bloomberg, Kolwezi, August 1, 2012)
Glencore shares, which were under strong selling pressure on Tuesday, have picked up steam. The product group based in Switzerland yesterday announced the launch of a major share buyback program worth $ 1 billion. As a result, the London Stock Exchange has traded about 2 percent to over 325 pence.
At the beginning of the week, securities were still trading at over 370 pence, until US investigations into suspicious business practices in Nigeria, Venezuela and the Democratic Republic of from Congo panic investors. The Ministry of Justice (DOJ) has requested the filing of documents and other documents related to possible violations of anti-corruption and anti-money laundering laws. The news led to a drop in prices, which stood at 13 percent at the top.
Baarer Commodities Company Blackstone Resources
New to the Stock Market
The Swiss Stock Exchange Announces a Short-Listed Initial Public Offering: Blackstone Resources intends to list its shares on SIX Swiss Exchange on Monday next. The goal is to increase advertising through the IPO, expand the shareholder base and in the future to raise funds for d & # 39; other acquisitions, like Blackstone Resources announced yesterday. The company, headed by President and Chief Executive Officer Ulrich Ernst, was founded in 1995. In 2017, Blackstone Resources realized a profit of CHF 3.8 million. In total, 42.7 million shares must be listed on the SIX under the symbol BLS. According to their own calculations, the group sees the value of the shares at CHF 13.50 per share.
Blackstone Resources is headquartered in Baar and operates in the commodities sector, both in trade and production. It builds, develops and manages production facilities in Peru, Colombia, Canada, Norway and Mongolia. They focus on the production of gold and silver, and in particular for the metals required by manufacturers of cobalt, manganese, molybdenum, lithium, graphite, copper and nickel batteries. . (nda)
The timing of the announcement of the repurchase of shares is not a coincidence. Financial analysts suggest that Glencore hopes to boost investors' cracked confidence. The transaction may be seen as an indication that Glencore's management views the stock market's negative reaction as exaggerated, quotes the Bloomberg news agency, a comment from Britain's Barclays Bank. The repurchase of shares will be done in two phases, as announced by Glencore: in an initial phase that will last until August 7, the day before the announcement of the half – year results, shares of the Company. a value of 350 million pounds sterling (about 460 million dollars) will be bought back, The second phase lasts until the end of the year.
If the redemption of shares will be able to produce the desired effect by management on a permanent basis will be shown. The market value of Glencore is 47 billion pounds, or about 62 billion dollars. On ordinary days, transactions worth $ 100 to $ 200 million are underway. According to industry analysts, the activities of commodity companies and mining companies are currently working well. Rio Tinto, its rival, has recently increased its share buyback program.
Sustainability report highlights the important role of coal
Glencore shares are viewed by investors as particularly risky. This, although the group was able to reduce the huge net debt after the acquisition of Xstrata in three years, from 30 billion to only 10 billion. Of course, Glencore's course of action has a particularly important impact on the open part of the Justice Department's research. As a result of the financial crisis, the Department of Justice billed billions of dollars in invoices for illicit business practices. But also Glencore's business portfolio should not appeal to many investors. In 2017, the Group produced more than 120 million tonnes of coal in its 26 mines in Australia, South Africa and Colombia. 106 million tonnes produced by third parties were marketed by Glencore. The group describes itself as one of the largest coal producers in the world. Many climate experts strongly recommend a drastic reduction in the use of CO2-intensive fuel.
This week the Swiss Re insurance company announced that it would offer more insurance coverage to companies whose share of coal accounts for more than 30% of its volume d & # 39; business. And a growing number of investment companies are trying to avoid investments in the titles of major fossil fuel producers. At Glencore too, investors had already asked for answers to the question of whether, in the context of a changing global climate regime, the company would even be able to tap into its huge coal reserves. However, in the current Sustainability Report, Glencore shows no respect for such scenarios: coal, as a cheap and abundant resource, will continue to play an important role in the development of emerging economies. Thanks to the Group's broad diversification, the 30% Swiss Re threshold is not a serious problem for Glencore.
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