The Glencore IPO: Bring in Clancy, Ludlum and the CIA

Reuters recently referred to Glencore as the largest company you never heard of. Glencore, headquartered in Baar, Switzerland is one of the world’s leading integrated producers and marketers of commodities that industries around the world need. Glencore has worldwide activities in the production, sourcing, processing, refining, transporting, storage, financing and supply of metals and minerals, energy products and agricultural products. It’s a monster and may be the sixth largest company in Europe. The company is going public over the next two weeks and may be raising upwards of $11 billion.

The history of Glencore reads like a Robert Ludlum or Tom Clancy spy novel.  The company is a mystery wrapped in an enigma. They operate from  a small hamlet in Switzerland and pride themselves with flying under the radar. The company is very well connected globally and enjoys political connections everywhere, especially in rogue nations.

Billionaire commodity trader Marc Rich started the company back in 1974 when it was Marc Rich & Company. After a bad zinc trade that resulted in a loss of over $200 million Rich was asked to sell back his interest to his partners who renamed the company Glencore.  However Rich’s “lieutenants” at the old company still run Glencore and some have speculated that Rich is still involved to some degree. Marc Rich was charged with tax evasion, criminal activity and illegal business dealings here in the U.S, but was pardoned by Bill Clinton in 2001. Rich’s wife, Denise Eisenberg ( now Denise Rich, famous Grammy winning songwriter and gazillionaire in her own right), had donated $400,000 to the Clinton library and later $1 million to the DNC prior to the pardon. I’m sure the Rich pardon was just a co-inky-dink. Every President has pardoned criminals, I just never got that. Marc Rich was trading illegal oil with Iran during the American hostage crisis as well as other nefarious acts.

Glencore had been accused of illegal dealing with rogue states, apartheid South Africa, USSR, The Congo, Iran and has a history of busting UN embargoes to profit from corrupt or despotic regimes. Specifically Glencore was named by the CIA to have paid over $3 million in kickbacks to obtain oil in the course on the UN oil-for-food program for Iraq.

Denise Richards & Bill Clinton
Denise Rich & Bill Clinton

The IPO will be listed in London and in Hong Kong, but not here in the U.S. I’m sure the gentlemen running Glencore are just swell fellows. Is the company still a beard for Marc Rich or is he just to wealthy to care anymore? The deal will probably do very well regardless.

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