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GLN: Glencore Announces Issuance Of Convertible Bonds.
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NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE IN OR INTO THE UNITED STATES OR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
19 September 2018
Glencore plc launches a tap issue of non-dilutive zero coupon
cash settled guaranteed convertible bonds for up to USD 150
million to be consolidated with its USD 500 million non-dilutive
zero coupon cash settled guaranteed convertible bonds due 2025
Glencore plc (“Glencore”), through its subsidiary Glencore Funding LLC (the
"Issuer"), announces today the launch of a tap issue of non-dilutive zero
coupon cash settled guaranteed convertible bonds due 27 March 2025 (the “New
Bonds”) with a nominal amount of USD 125 million, with an option to increase
the offering to USD 150 million.
The New Bonds are to be issued on the same terms (save for the issue price)
as the USD 500 million zero coupon non-dilutive cash settled guaranteed
convertible bonds due 27 March 2025 issued by Glencore Funding LLC on 27
March 2018 (the “Original Bonds”) and, as of 40 days after the settlement
date of the New Bonds, shall be fully fungible and consolidated with the
Original Bonds (together, the “Bonds”).
Concurrently with the placing of the New Bonds, the Issuer will purchase from
one or more hedge counterparties cash-settled call options (the “Call
Options”) on shares of Glencore (the “Shares”) to hedge the increase in 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 New Bonds will be used for general
corporate purposes and for the purchase of the Call Options.
The New Bonds will be issued with an issue price between 89% and 89.5% of
their nominal value. The initial issue price of the New Bonds will be
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announced by no later than market open on 20 September 2018. The final issue
price will be determined following a reference period of 2 consecutive
trading days after pricing (from 20 September 2018 to 21 September 2018) (the
“Reference Period”) in order to reflect the share price performance and the
evolution of the GBP/USD exchange rate. The final issue price of the New
Bonds will be announced on 21 September 2018.
The settlement and delivery of the New Bonds is expected to take place on 26
September 2018 (the “Issue Date”).
The New Bonds will be offered via an accelerated book building process
through a private placement to institutional investors only, outside the
United States, Australia, Canada, Japan, Jersey, South Africa or any other
jurisdiction in which offers or sales of the New Bonds would be prohibited by
applicable law. No prospectus, offering circular or similar document will be
prepared in respect of the offering of the New 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 Reference Period and at the conversion
or redemption of the Bonds.
An additional application will be made for the New 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 41 days
after the Issue Date of the New 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 Sole Global Coordinator.
BNP PARIBAS is acting as Sole Global Coordinator for the offering and
together with Citigroup Global Markets Limited as Joint Bookrunners.
For further information please contact:
Investors
Martin Fewings t: +41 41 709 m: +41 79 737 martin.fewings@glencore.com
Ash Lazenby 2880
t: +41 41 709 5642
m: +41 79 543 ash.lazenby@glencore.com
Media 2714 3804
Charles Watenphul t: +41 41 709 24 m: +41 79 904 33 charles.watenphul@glencore.com
62 20
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 BNP Paribas or Citigroup Global
Markets Limited (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 New Bonds have been subject to a product approval process, which has determined
that: (i) the target market for the New Bonds is eligible counterparties and professional clients
only, each as defined in MiFID II; and (ii) all channels for distribution of the New Bonds to
eligible counterparties and professional clients are appropriate. Any person subsequently
offering, selling or recommending the New 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 New 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
New 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 New Bonds.
The New 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 New Bonds or otherwise making them
available to retail investors in the EEA has been prepared and therefore offering or selling the
New 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 New 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 New 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 New Bonds, each of the Managers and any of their
respective affiliates may take up a portion of the New 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 New 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.
BNP Paribas London Branch is lead supervised by the European Central Bank (ECB) and the Autorité
de Contrôle Prudentiel et de Résolution (ACPR). BNP Paribas London Branch is authorised by the
ECB, the ACPR and the Prudential Regulation Authority and subject to limited regulation by the
Financial Conduct Authority and Prudential Regulation Authority. Citigroup Global Markets Limited
is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct
Authority and the Prudential Regulation Authority.
The Managers 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.
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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 Banking Division)
Date: 20/09/2018 08:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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