From London to New York to Hong Kong, the frantic question kept coming: could this be another Lehman?
But nowhere did it cause more alarm than inside Glencore Plc — the Swiss commodities giant that had suddenly found itself at the epicenter of a global panic on Monday.
What began that morning in London, with a sudden plunge in Glencore’s share price, cascaded across oceans and time zones and left the company’s billionaire chief executive, Ivan Glasenberg, scrambling to calm anxious shareholders, creditors and trading partners.
Days later, even as Glencore regained most of the $6 billion of shareholder wealth erased in a few hours, many investors wondered if Glasenberg can hold the markets at bay.
Few market players, including people close to Glencore, are able to pinpoint why a blue-chip member of the FTSE-100 Index — even one that had been under pressure from sliding commodities prices — lost almost a third of its value in a blink. And that, investors worry, suggests this could all happen again.
“There’s more pain to be had,” said Serge Berger, a Zurich-based trader at Blue Oak Advisors LLC. “I don’t think the story is over.”
This report of how the fear spread and was eventually pacified is the product of interviews with 13 bankers, investors, and others involved in this week’s events, all of whom asked not to be identified discussing a private matter. A spokesman for Glencore declined to comment.
Monday started out as just another workday in Baar, the tiny town where Glencore is based. The village could easily pass for a Swiss backwater, except for the billions of dollars worth of commodities that quietly course through Glencore’s headquarters on Baarermattstrasse, between the lake and the Alpine hills.
Glasenberg, a former coal trader, has honed his skills over more than 30 years in the commodity-trading business since he joined a predecessor firm, Marc Rich & Co., in 1984.
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