Glencore Prepares to Make Its Entrance in Australia, Investors are Looking Past Coal
Following briefings on the IPO, experts and investors stated that Glencore may surge into top market indices within six months of listing in Australia because fund managers’ thirst for copper may outweigh worries about thermal coal risk.
The largest thermal coal exporter in the world, Glencore (GLEN.L), plans a secondary listing on the Australian Securities Exchange in October with the goal of accessing one of the fastest-growing institutional capital pools in the world to finance its aspirations for copper growth and possibly pave the way for significant M&A.
This month, investors were briefed by brokers such as JPMorgan, Barrenjoey, and UBS about Glencore’s potential listing and its implications for the business and index. Participants reported that these sessions were well-attended.
Barrenjoey did not respond to a request for comment, and JPMorgan and UBS declined to comment.
According to Glencore CEO Gary Nagle, the $88 billion business can be included in Australia’s benchmark S&P/ASX 200 index (.AXJO), opening a new tab within a year, provided the CDIs reach a market value of A$1.5 billion ($1.06 billion). Its ASX-traded shares must have a market value of at least A$5.5 billion in order to be eligible for the bigger S&P/ASX 100 index (.ATOI), opens new tab.
The stock’s momentum, according to analysts, might push it into the top 100 index far sooner. Anecdotally, Glyn Lawcock, an analyst at Barrenjoey in Sydney, stated, “I think everyone is eager to understand who Glencore is and what the offering is going to be.”