Glencore Case Analysis

The article that I have been chosen is Glencore. Glencore Plc is known as one of the largest global diversified natural resources company. And also have a major influence in producer and trader of more than 90 commodities.
I have picked Glencore Plc because looking at the crisis Glencore have been facing for the past period of time, in my opinion as very important and showed to me the amount of risk them were facing on their behalf.
Glencore Plc have been facing crisis which were coming from the trails of china, for not using the enough amount of commodities and of course since Glencore is the trader of many different commodities it affects themreally hard. This leads to commodities prices decreasing dramatically and this is where Glencore
Statistics has showed and proved to us that they have lost around 77% of their shares since the start of the year and a 29% plunge in Glencore share price. One of the recent falls took the chief executive to stake below 1 billion pounds in value, that was of course reduced to 850million sterling’s. Even by looking at the shares, 300 million shares have been changing four times the daily average.
The other areas that cached my eye was that even China was concerned about the slowdown, and that because of the demand showing the year’s investments’ into new products was a clear waste. All of the commodities that Glencore has produced are now closing down due to their lowest levels since the financial crises has hitted them.
Glencore has suffered the most of the losses is because of their massive levels of debt which was estimated to be capitalised around 16 billion sterling. Company has commented that it is being used by hedge funds as a proxy against the china
Coopers and oil price were the main reduction issue to the profits for commodity companies globally. In previous years, Glencore’s trading business, unique for a large mining company, cushioned the impact of lower commodity prices. So far this year, trading was weak due to a fall in the premiums that traders charge clients for the delivery of metals such as aluminium and
Their debt has been at the rebound stage alongside with the share prices, as investors have been discussing its ability to manage the debts pile in commodity side of view. The company has mentioned itself that even if the share pricehasfallingdramatically, we are still holding and retaining in strong lines on credit and the full access to the funding protective’s. As glencore has stated that they don’t have no debts covenants and continues to remain strong lines of credit and secure access of funding and that’s all thanks to the long term relationship they have with the banks. The banks have helped glencore to place the shares at 125p, which is more than a third above the current levels out there in the markets.Glencore’s ability to manage its debt position will also be a significant risk to valuation and price.
The other information that was outlined for the rebound, was that the chairman Tony Hayward has purchased stock of 91000 Pounds. It is not explained that Glencore is performing much better and trying to move up out from the crisis, but it has showed the improvements to the risk they have been facing for the past