Glencore International AG’s initial public offering may value Chief Executive Officer Ivan Glasenberg’s stake at $9.6 billion, more than Google Inc. (GOOG) and Blackstone Group LP (BX)’s founders reaped in their IPOs.
Glasenberg, 54, will own 16 percent of the Swiss commodity trader after the sale, which may give the company a market capitalization of about $61 billion, according to a prospectus published today.
Stephen Schwarzman’s stake in Blackstone was $8.8 billion when the New York-based private-equity firm went public in June 2007. Google founders Larry Page and Sergey Brin held $3.28 billion and $3.27 billion of the internet search company’s stock at its IPO in 2004. Goldman Sachs Group Inc. (GS)’s IPO, 12 years ago, pegged then-CEO Henry Paulson’s stake at $219 million.
“I can’t think of any other IPO where an individual’s stake was valued this highly,” said Jay Ritter, a finance professor at the University of Florida in Gainesville.
Glencore’s IPO is set to make at least four more senior executives billionaires. Daniel Mate and Telis Mistakidis, the Baar, Switzerland-based firm’s top traders of zinc, copper and lead, will hold 6 percent stakes valued at about $3.7 billion, the filing shows. Tor Peterson, director of coal and coke, and Alex Beard, who oversees oil trading, will have stakes of about $3.2 billion and $2.8 billion, the prospectus shows.
Simon Buerk, a Glencore spokesman in Baar, couldn’t immediately be reached for comment today.
Glasenberg and Glencore’s top executives won’t be able to sell any of their stakes in the year following the IPO. They will be able to sell as much as 20 percent of their original holding over each of the next four years, the filing shows.
Their wealth will, therefore, fluctuate with the stock price. Blackstone, which first sold shares to the public for $31 each, now trades at $18.05, eroding Schwarzman’s wealth. By contrast, Brin and Page’s stake in Google has soared in value as the stock jumped from its $85 IPO price to more than $534 today.
“This is the best time for an IPO,” said Michael Tamvakis, a commodities professor at Cass Business School in London. “Glencore’s margins are driven by commodity prices. If prices fall, those will be squeezed.”
Amancio Ortega’s holding in Inditex SA, the clothing company he founded, was valued at 6.9 billion euros, about $5.9 billion at the exchange rate when the stock began trading in May 2001.
Ortega, 75, is the world’s seventh-richest person, according to Forbes’s list of billionaires for 2011. Glasenberg would rank 92nd, after Johanna Quandt, a member of Bayerische Motoren Werke AG’s controlling family, and Maria-Elizabeth and Georg Schaeffler, who own part of Schaeffler Group, the world’s biggest maker of roller bearings.
Glasenberg, an accounting graduate, has been at Glencore since 1984 and CEO since 2002. He was part of a management-led buyout of the business from founder and former fugitive U.S. financier Marc Rich in 1994.
Glasenberg, who was once a competitive walker and completed two Swiss triathlons at the age of 43, graduated in 1981 from the University of the Witwatersrand. He earned his accounting certification at Levitt Kirson and his master of business administration degree from the University of Southern California in 1983. He joined Glencore a year later.
The company plans to sell shares at 480 pence ($7.95) to 580 pence each, Glencore said in a statement today. The final price will be set around May 19, when the stock is set to begin trading.
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