London-listed Glencore plans a secondary listing on the Australian stock market just a year after ditching a switch to New York.
Glencore said Wednesday that a listing on the ASX would broaden its shareholder base, improve trading liquidity and enhance its corporate financial flexibility. It said it intends to apply for the secondary listing and is targeting admission of its shares in October.
The intention to list its shares in Australia comes after it held failed talks this year with rival Rio Tinto about a potential tie-up that could have turned it into the world's biggest mining company and copper producer. Rio Tinto is dual-listed in London and Sydney.
The decision also comes nearly a year after it pulled plans to switch its main listing to New York from London. At the time it said that despite the scale and depth of U.S. capital markets, switching its listing or having a sponsored American depositary receipts program wouldn't offer better value for shareholders at that time. It promised to keep its listing under review.
The move was made alongside its first-half results.
The period was exceptionally profitable for Glencore, which was aided by a vast trading arm that capitalized on roiling energy markets triggered by conflict in the Middle East and posted a near record first-half result.
Group adjusted earnings before interest, taxes, depreciation and amortization rose 86% to $10.115 billion. Its trading unit reported a more than doubling of adjusted earnings before interest and taxes to $3.3 billion.
Glencore's energy traders are among the world's largest buyers and sellers of crude oil and its products. They source commodities and sell them to customers around the world. They also buy from third parties with the goal of selling for a higher price. Benefiting from price differences--or arbitrage--across locations is central to how traders make money.
Closure of the key Strait of Hormuz chokepoint on the Persian Gulf left countries scrambling for replacement oil and gas supplies. Jet fuel and diesel were particularly hit and commanded high premiums.
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