Glencore considers Kazakh gold mine sale to cut debt – by James Wilson, Neil Hume and Arash Massoudi(Financial Times – May 3, 2016)

Glencore is exploring options for its biggest gold mine — which could include a $2bn sale — as it steps up its efforts to reduce its debt burden.

Chinese miners are expected to lead the running to buy the company’s Vasilkovskoye project in Kazakhstan, according to people familiar with the sale process, following a rebound in the price of the precious metal this year. Glencore decided to consider a sale after being approached by several suitors, and has appointed BMO Capital Markets and Deutsche Bank to handle a possible deal.

A successful disposal would bring Glencore much closer to its target of bringing net debt below $18bn this year, and down to $15bn by the end of 2017 — a strategy intended to reassure investors who last year grew concerned at the Swiss group’s ability to withstand tumbling commodity prices.

Last year, Glencore’s UK-listed shares were among the worst performing in London. However, the group has already helped to shore up confidence through a series of asset sales, culminating in the $2.5bn disposal of a minority stake in its agriculture business last month.

While Glencore’s dealings in commodities extend from coal to soya beans, its precious metal assets — including gold — have long been viewed as non-core, and therefore those most likely to be sold.

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