The headquarters of Glencore International AG stand in Baar, Switzerland. The agreement would give Glencore control of deposit in southern Peru with a resource base of 3 million metric tons of contained copper, as a lack of discoveries prompts producers to expand through acquisitions. Photographer: Gianluca Colla/Bloomberg
Glencore International Plc, the world’s biggest publicly traded commodities trader, made an initial agreement to buy CST Mining Group Ltd. (985)’s Peruvian copper project for $475 million, according to CST.
Glencore, based in Baar, Switzerland, will own 70 percent of the Mina Justa copper project after the two companies signed the accord on June 9, Hong Kong-based and Bermuda-incorporated CST said today in a statement. A call to Glencore’s office in Switzerland after normal business hours wasn’t answered.
The agreement would give Glencore control of deposits in southern Peru with a resource base of 3 million metric tons of contained copper, as a lack of discoveries prompts producers to expand through acquisitions.
“It highlights that Glencore has a clear intent to use the leverage it has been afforded by the new listing to acquire,” James Bruce, who helps manage about $3.5 billion at Perpetual Ltd., said by phone from Sydney. “That it is wasting no time is testament to it backing itself to add value.”
CST rose 19 percent to 23.2 Hong Kong cents at 1:42 p.m. local time. Glencore climbed 2.3 percent to HK$66.50, taking its gains to 2.5 percent since its initial public offering in Hong Kong and London last month.
The deal may be completed on or before Oct. 15, subject to Glencore conducting due diligence and shareholder approval, CST said.
Glencore was studying a takeover of Eurasian Natural Resources Corp., a producer of metals in Kazakhstan, the Sunday Times reported June 12.
Glencore Chief Executive Officer Ivan Glasenberg held talks with shareholders controlling about 45 percent of Eurasian Natural and may offer 12 billion pounds ($19.7 billion), the Sunday Times said yesterday, citing a person it didn’t identify. Glencore is a potential buyer of Kazakhmys’s stake in Eurasian Natural, Liberum Capital Ltd. said in January.