CIC mum on plan to buy into Glencore

Shanghai Daily via agencies, March 5, 2011

A senior official at China's US$300 billion sovereign wealth fund yesterday said he had not heard of any plans for the fund to buy a stake in Glencore International AG, the world's largest commodities trader, which is aiming for a potential stock market listing.

Glencore's possible initial public offering could value it at about US$60 billion and the deal could be a fee bonanza for investment bankers.

"I haven't heard about this," said Jesse Wang, an executive vice president of China Investment Corp, when asked about making investments in Glencore.

He also said the CIC saw investment opportunities in real estate in developed countries, including the United States and Japan.

There has been speculation about CIC being approached to become a cornerstone shareholder in Glencore.

CIC has been interested in taking exposure to the resources sector and owns 14.7 percent in Noble Group Ltd, Asia's biggest commodities trader.

Qatar Investment Authority, one of the sovereign wealth funds flagged as a possible cornerstone shareholder, is considering investing in Glencore, the country's prime minister said on Monday.

Cornerstone shareholders usually have a lock-up anywhere between six and 12 months on their investments, and their presence on a company's register helps generate demand in the IPO.

Asian wealth funds are natural targets for companies planning large IPOs, as was evident in last year's two mega deals from the Agricultural Bank of China to a lesser extent AIA Group Ltd.

Glencore's possible IPO is one of the most hotly anticipated capital market events this year.