Glencore may consider switching UK listing for US

London Stock Exchange LSE

GLENCORE may consider switching its primary listing from London to New York, said Bloomberg News citing a report by analysts at Deutsche Bank. If borne out, the delisting of Glencore from London would be one of the most high-profile exits from the UK exchange to date, the newswire said.

Liam Fitzpatrick and colleagues said the UK copper mining and trading firm’s primary listing could come into focus due to a lack of shareholder support for a plan to split off its coal business and list it seperately in New York.

Glencore completed the $6.93bn takeover of Teck’s Elk Valley Resources in November. But the group said it would take time to absorb the unit before spinning it out on the New York Stock Exchange in a company also containing its own thermal coal mines.

Bloomberg cited Deutsche Bank as saying the US market was more supportive of companies involved in fossil fuels, with many in Europe excluding the sector from their portfolios. Meanwhile, US-listed copper stocks trade at very large premiums to the UK miners, they said.

“UK valuations and coal exclusion could lead to a US listing being considered” by Glencore, they wrote, “We hope the UK remains a key hub for mining investments, but if the valuation gap persists, a shift in listing could make sense.”

A spokesman for Glencore declined to comment.

In March Tribeca Investment Partners said in a letter to Glencore that its coal mines should be retained even after buying Teck’s coal.

“We firmly oppose such divestiture and call on the board to retain these world class assets. Not only does retention align with the company’s long-held commitment to industry leading policy, but also strategically supports its earnings profile and the delivery of value to shareholders,” said Tribeca in the letter.