Glencore to issue new bonds

Date: Sep 21, 2018

Global diversified miner Glencore has placed a tap issue of nondilutive zero-coupon cash settled guaranteed convertible bonds for $125-million to be consolidated with its $500-million nondilutive bonds due 2025.

The new bonds are to be issued on the same terms as the original bonds and, as of the date falling 41 days after the issue date, which is expected to be September 26, the new bonds will be fully fungible and consolidated with the original bonds.

Concurrently with the placing of the new bonds, the issuer has bought from one or more hedge counterparties cash-settled call options on shares of Glencore 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 initial issue price of the new bonds will be 89% of their nominal value. The final issue price of the new bonds will be announced on September 21.

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