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GLENCORE PLC - GLN - Successful placing of $500 million non-dilutive cash settled guaranteed convertible bonds due 2025

Release Date: 22/03/2018 07:20
Code(s): GLN     PDF:  
Wrap Text
GLN - Successful placing of $500 million non-dilutive cash settled guaranteed convertible bonds due 2025

Glencore plc
(Incorporated in Jersey under the Companies (Jersey) Law 1991)
(Registration number 107710)
JSE Share Code: GLN
LSE Share Code: GLEN
HKSE Share Code: 805HK
ISIN: JE00B4T3BW64

This press release relates to the disclosure of information that qualified,
or may have qualified, as inside information within the meaning of Article
7(1) of the EU Market Abuse Regulation.

NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE IN OR INTO THE UNITED STATES OR
FOR THE ACCOUNT OR BENEFIT OF U.S. PERSONS (AS DEFINED IN REGULATION S UNDER
THE U.S. SECURITIES ACT OF 1933, AS AMENDED), OR IN OR INTO AUSTRALIA,
CANADA, SOUTH AFRICA OR JAPAN OR ANY JURISDICTION IN WHICH OFFERS OR SALES
WOULD BE PROHIBITED BY APPLICABLE LAW

Glencore plc
Baar, Switzerland
20, March 2018

Glencore plc announces the successful placing of $500
million non-dilutive cash settled guaranteed
convertible bonds due 2025

Glencore plc (“Glencore”), through its subsidiary Glencore Funding LLC (the
"Issuer"), announces the successful placing of an offering of $500 million
non-dilutive cash settled guaranteed convertible bonds due 2025 (the "Bonds")
guaranteed by Glencore, Glencore International AG and Glencore (Schweiz) AG
(together, the "Guarantors"). Concurrently with the placing of the Bonds, the
Issuer purchased cash-settled call options (the “Call Options”) on shares of
Glencore (the “Shares”) to hedge its economic exposure to a potential
exercise of the conversion rights embedded in the Bonds. As conversion rights
in respect of the Bonds will be cash-settled only, the issue and conversion
of the Bonds will not result in the issuance of any new shares, or the
delivery of existing shares, of Glencore or any other group company.

The net proceeds of the offering of the Bonds will be used for general
corporate purposes and for the purchase of the Call Options.

The nominal value of each Bond is $200,000. The Bonds will not bear interest
and will be issued at an issue price of 93.25% of their nominal value,
corresponding to an annual gross yield to maturity of 1.00%, on 27 March
2018, the expected settlement date of the Bonds. The Bonds will be redeemed
at par on 27 March 2025 unless previously redeemed or converted in accordance
with their terms. The initial conversion price will be 25% above the Share
Reference Price (as defined below).

The reference price of the Shares (the “Share Reference Price”) will be
determined as the arithmetic average of the daily volume-weighted average
prices of the Shares in sterling on the London Stock Exchange on each of the
10 consecutive trading days commencing on (and including) 21 March 2018 (the
“Share Reference Price Period”). The initial conversion ratio of the Bonds
will correspond to the nominal value per Bond converted into sterling and
divided by the initial conversion price.

The Bonds were offered via an accelerated book building process through a
private placement to institutional investors only, outside the United States,
Australia, Canada, Japan, South Africa or any other jurisdiction in which
offers or sales of the Bonds would be prohibited by applicable law. No
prospectus, offering circular or similar document will be prepared in respect
of the offering of the Bonds.

It is anticipated that the hedge counterparties to the Call Options, which
may include the Joint Bookrunners, will enter into transactions to hedge
their respective positions under the Call Options through the purchase or
sale of Shares or any other transactions, on the market and off-market, at
any time, and in particular during the Share Reference Price Period and at
the conversion or redemption of the Bonds.

The Share Reference Price, initial conversion price, initial conversion ratio
and dividend threshold will be announced through a press release at the end
of the Share Reference Price Period, expected to occur on 5 April 2018.

Application will be made for the Bonds to be admitted to trading on the Open
Market (Freiverkehr) segment of the Frankfurt Stock Exchange and such
admission to trading is expected no later than 90 days after the issue date
of the Bonds.

In the context   of the offering, Glencore and the Issuer will agree to a lock-
up undertaking   in relation to its Shares and equity-linked securities for a
period ending    90 calendar days after the date hereof, subject to certain
exceptions and   waiver by the Global Coordinator.

BofA Merrill Lynch is acting as Sole Global Coordinator for the offering and
together with BNP PARIBAS, Barclays Bank PLC, HSBC and J.P. Morgan Securities
plc as Joint Bookrunners.

For further information please contact:

Investors
Martin Fewings   t: +41 41 709 2880   m: +41 79 737 5642   martin.fewings@glencore.com
Ash Lazenby      t: +41 41 709 2714   m: +41 79 543 3804   ash.lazenby@glencore.com

Media
Charles          t: +41 41 709 24 62 m: +41 79 904 33 20 charles.watenphul@glencore.com
Watenphul
www.glencore.com

Glencore LEI: 2138002658CPO9NBH955

Notes for Editors

Glencore is one of the world’s largest global diversified natural resource
companies and a major producer and marketer of more than 90 commodities. The
Group's operations comprise around 150 mining and metallurgical sites, oil
production assets and agricultural facilities.
 
With a strong footprint in both established and emerging regions for natural
resources, Glencore's industrial and marketing activities are supported by a
global network of more than 90 offices located in over 50 countries.

Glencore's customers are industrial consumers, such as those in the
automotive, steel, power generation, oil and food processing sectors. We also
provide financing, logistics and other services to producers and consumers of
commodities. Glencore's companies employ around 146,000 people, including
contractors.

Glencore is proud to be a member of the Voluntary Principles on Security and
Human Rights and the International Council on Mining and Metals. We are an
active participant in the Extractive Industries Transparency Initiative.

Disclaimer

This announcement is not a prospectus and has been made for information
purposes only and shall not constitute, or be relied upon in connection with,
an offer to buy, sell, issue, or subscribe for, or the solicitation of an
offer to buy, sell, issue, or subscribe for, any securities, nor shall there
be any sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful. The information contained in this
announcement is for background purposes only and does not purport to be full
or complete, and is subject to change. No reliance may be placed by any
person for any purpose on the information contained in this announcement or
its accuracy, fairness or completeness.

This announcement does not contain or constitute an offer of, or the
solicitation of an offer to buy, any securities referred to herein to any
person in the United States, Australia, Canada, South Africa or Japan or in
any jurisdiction to whom or in which such offer or solicitation is unlawful.
This announcement is not for publication or distribution, directly or
indirectly, in or into the United States, or for the account or benefit of
U.S. persons (as defined in Regulation S under the US Securities Act of 1933,
as amended (the "Securities Act")). The distribution of this announcement may
be restricted by law in certain jurisdictions and persons into whose
possession any document or other information referred to herein comes should
inform themselves about and observe any such restriction. The securities
referred to herein may not be offered or sold in the United States, or for
the account or benefit of U.S. persons, unless registered under the
Securities Act or offered in a transaction exempt from, or not subject to,
the registration requirements of the Securities Act. The offer and sale of
the securities referred to herein have not been and will not be registered
under the Securities Act or under the applicable securities laws of
Australia, Canada, South Africa or Japan. Any failure to comply with these
restrictions may constitute a violation of the securities laws of any such
jurisdiction.

No action has been taken by the Issuer, the Guarantors, or by Merrill Lynch
International, BNP PARIBAS, Barclays Bank PLC, HSBC Bank plc or J.P. Morgan
Securities plc (together, the “Managers”) or any of their respective
affiliates, or any other person that would permit an offer of the securities
referred to herein or possession or distribution of this announcement or any
other offering or publicity material relating to the securities referred to
herein in any jurisdiction where action for that purpose is required. Persons
into whose possession this announcement comes are required by the Issuer, the
Guarantors, and the Managers to inform themselves about, and to observe, any
such restrictions.

Solely for the purposes of the product governance requirements contained
within: (a) EU Directive 2014/65/EU on markets in financial instruments, as
amended (“MiFID II”); (b) Articles 9 and 10 of Commission Delegated Directive
(EU) 2017/593 supplementing MiFID II; and (c) local implementing measures
(together, the “MiFID II Product Governance Requirements”), and disclaiming
all and any liability, whether arising in tort, contract or otherwise, which
any “manufacturer” (for the purposes of the MIFID II Product Governance
Requirements) may otherwise have with respect thereto, the Bonds have been
subject to a product approval process, which has determined that: (i) the
target market for the Bonds is eligible counterparties and professional
clients only, each as defined in MiFID II; and (ii) all channels for
distribution of the Bonds to eligible counterparties and professional clients
are appropriate. Any person subsequently offering, selling or recommending
the Bonds (a "distributor") should take into consideration the manufacturers’
target market assessment; however, a distributor subject to MiFID II is
responsible for undertaking its own target market assessment in respect of
the Bonds (by either adopting or refining the manufacturers’ target market
assessment) and determining appropriate distribution channels. The target
market assessment is without prejudice to the requirements of any contractual
or legal selling restrictions in relation to any offering of the Bonds. For
the avoidance of doubt, the target market assessment does not constitute: (a)
an assessment of suitability or appropriateness for the purposes of MiFID II;
or (b) a recommendation to any investor or group of investors to invest in,
or purchase, or take any other action whatsoever with respect to the Bonds.

The Bonds are not intended to be offered, sold or otherwise made available to
and should not be offered, sold or otherwise made available to any retail
investor in the European Economic Area ("EEA"). For these purposes, a retail
investor means a person who is one (or more) of: (i) a retail client as
defined in point (11) of Article 4(1) of MiFID II; or (ii) a customer within
the meaning of Directive 2002/92/EC (as amended, the "Insurance Mediation
Directive"), where that customer would not qualify as a professional client
as defined in point (10) of Article 4(1) of MiFID II. Consequently no key
information document required by Regulation (EU) No 1286/2014 (as amended,
the "PRIIPs Regulation") for offering or selling the Bonds or otherwise
making them available to retail investors in the EEA has been prepared and
therefore offering or selling the Bonds or otherwise making them available to
any retail investor in the EEA may be unlawful under the PRIIPS Regulation.

In addition, in the United Kingdom, this announcement is being distributed
only to, and is directed only at, persons (i) who have professional
experience in matters relating to investments falling within Article 19(5) of
the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005,
as amended (the “Order”); (ii) who fall within Article 49(2)(A) to (D) of the
Order; or (iii) to whom it may otherwise lawfully be communicated (all such
persons together being referred to as “Relevant Persons”). The information in
this announcement must not be acted on or relied on by persons who are not
Relevant Persons. Any investment or investment activity to which this
announcement relates is available only    to   Relevant   Persons   and   will   be
engaged in only with Relevant Persons.

This announcement may include statements that are, or may be deemed to be,
"forward-looking statements".     These forward-looking statements may be
identified by the use of forward-looking terminology, including the terms
"believes", "estimates", "plans", "projects", "anticipates", "expects",
"intends", "may", "will" or "should" or, in each case, their negative or
other variations or comparable terminology, or by discussions of strategy,
plans, objectives, goals, future events or intentions. Forward-looking
statements may and often do differ materially from actual results. Any
forward-looking statements reflect the Issuer's current view with respect to
future events and are subject to risks relating to future events and other
risks, uncertainties and assumptions. Forward-looking statements speak only
as of the date they are made. Each of the Issuer, the Managers and their
respective affiliates expressly disclaims any obligation or undertaking to
update, review or revise any forward-looking statement contained in this
announcement, whether as a result of new information, future developments or
otherwise.

Any decision to purchase any of the Bonds should only be made on the basis of
an independent review by a prospective investor of the Issuer and the
Guarantors’ publicly available information. None of the Managers nor any of
their respective affiliates or any of its and their directors, officers,
employees, advisers or agents accepts any responsibility or liability
whatsoever for or makes any representation or warranty, express or implied,
as to the truth, accuracy or completeness of the information in this
announcement (or whether any information has been omitted from the
announcement) or any other information relating to the Issuer or any of its
subsidiaries or associated companies, whether written, oral or in a visual or
electronic form, and howsoever transmitted or made available or for any loss
howsoever arising from any use of this announcement or its contents or
otherwise arising in connection therewith. The information contained in this
announcement is subject to change in its entirety without notice up to the
closing date.

Each prospective investor should proceed on the assumption that it must bear
the economic risk of an investment in the Bonds or the ordinary shares
notionally underlying the bonds (together with the bonds, the “Securities”).
None of the Issuer, the Guarantors, or the Managers make any representation
as to (i) the suitability of the securities for any particular investor, (ii)
the appropriate accounting treatment and potential tax consequences of
investing in the securities or (iii) the future performance of the securities
either in absolute terms or relative to competing investments.

In connection with any offering of the Bonds, each of the Managers and any of
their respective affiliates may take up a portion of the Bonds or the
underlying shares as a principal position and in that capacity may retain,
purchase, sell or offer to sell for their own accounts such securities and
any other securities of the Issuer or any related investments in connection
with the offering of the Bonds or otherwise. In addition, each of the
Managers and any of their respective affiliates may enter into financing
arrangements (including swaps or contracts for differences) with investors in
connection with which they may from time to time acquire, hold or dispose of
any such securities or other investments. They do not intend to disclose the
extent of any such investment or transactions otherwise than in accordance
with any legal or regulatory obligation to do so.

Merrill Lynch International, BNP PARIBAS, Barclays Bank PLC, HSBC Bank plc
and J.P. Morgan Securities plc, each of which are authorised by the
Prudential Regulation Authority and regulated by the Financial Conduct
Authority and the Prudential Regulation Authority, are acting exclusively for
the Issuer and the Guarantors and no one else in connection with the
securities referred to herein. They will not regard any other person as their
respective clients in relation to the securities referred to herein and will
not be responsible to anyone other than the Issuer for providing the
protections afforded to their respective clients, nor for providing advice in
relation to such securities, the contents of this announcement or any
transaction, arrangement or other matter referred to herein.

Follow us on social media:
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     www.instagram.com/glencoreplc
     www.linkedin.com/company/8518
     www.slideshare.net/glencore
     www.twitter.com/glencore

     www.youtube.com/glencorevideos

Disclaimer

The companies in which Glencore plc directly and indirectly has an interest
are separate and distinct legal entities. In this document, “Glencore”,
“Glencore group” and “Group” are used for convenience only where references
are made to Glencore plc and its subsidiaries in general. These collective
expressions are used for ease of reference only and do not imply any other
relationship between the companies. Likewise, the words “we”, “us” and “our”
are also used to refer collectively to members of the Group or to those who
work for them. These expressions are also used where no useful purpose is
served by identifying the particular company or companies.

Sponsor
Absa Bank Limited (acting through its Corporate and Investment Bank Division)

Date: 22/03/2018 07:20:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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