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Glencore, the mining and commodities trading house run by billionaire Ivan Glasenberg, has sold a 51 per cent stake in its oil products storage business to China’s HNA Innovation Finance Group, the company said on Friday.

The deal, subject to regulatory approvals and closing conditions, will see the two companies form HG Storage International, which will operate oil storage assets across Europe, Africa and the Americas. The agreement will have a three-year lock-up period, the companies said, reflecting “a mutual agreement to a long-term partnership”.

The deal follows almost three years during which the oil glut made storage immensely profitable as traders scrambled for locations to place excess barrels when the market became swamped.

Opec’s production cuts, agreed late last year with other non-Opec producers like Russia, are expected to tighten the market and draw down inventories in the second half of this year.

Glencore has spent two years paying down debt by selling assets, cutting dividends and lowering costs, but has recently began to pursue deals again. Its share price has risen 13 per cent in 2017 to £3.14 after recovering from a record low of 66p in 2015.

Alex Beard, Glencore’s head of oil, said:

“HG Storage brings together Glencore’s expertise in the petroleum products storage business and extensive market knowledge with HNA’s global reach and strong position in Asia. HG Storage’s high quality assets are well positioned to take advantage of the future opportunities we expect to be created by the strong market fundamentals for the sector. We also look forward to exploring further potential opportunities for cooperation with HNA in areas of mutual interest.”

The deal is expected to close in the second half of 2017.

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