Glencore Investors to Glasenberg: Don’t Buy Anything Yet – by Scott Patterson and Alex MacDonald (Wall Street Journal – August 17, 2016)

LONDON—A year of debt cuts, asset sales and rising commodity prices have pulled Glencore PLC back from the brink of crisis. Now, the mining and trading giant’s shareholders have a new concern: That Chief Executive Ivan Glasenberg might return to his free-spending ways.

Mr. Glasenberg spent much of the past decade as the commodities industry’s biggest deal maker, snapping up coal, copper and gold mines in places such as East Africa, South America and Australia.

After a mounting debt pile and sagging commodities prices sent Glencore shares tumbling last year—the stock price fell 29% on a single day, Sept. 28 in London—investors pressured Mr. Glasenberg to slash borrowing and unload unprofitable mines. He suspended the company’s dividend, laid off workers to cut costs, and trimmed the company’s debt load to more sustainable levels, investors say.

With shares up about 180% since the free fall, Baar, Switzerland-based Glencore recently emerged as a contender in bidding for several big properties, including Australian coal assets that Rio Tinto PLC and Anglo American PLC were looking to sell, say people familiar with the sales talks.

Investors say Mr. Glasenberg has work to do before he can responsibly start buying, and are hoping to hear more about cost savings than new spending when the company reports earnings on Aug. 24. “First, we have to finish the deleveraging, then we have to restore the dividend,” said David Herro, a fund manager for Harris Associates LP who controls about 6% of Glencore’s stock, valued at about $2 billion.

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