Zijin Mining Group Co. has sold bonds convertible into shares of Glencore International Plc, the world’s largest publicly traded commodities supplier, according to three people familiar with the matter.
The bonds were sold at 128.25 percent of face value, said one of the people, who asked not to be identified because the process was private. Goldman Sachs Group Inc. (GS) managed the sale, according to a term sheet obtained by Bloomberg News.
Zijin Mining, China’s biggest gold miner by market value, acquired the bonds ahead of Glencore’s May initial public offering, which ended its more than three decades as a closely held partnership. Glencore, which sold $10 billion of shares in the biggest IPO this year, has dropped 20 percent since going public.
In December 2009 Glencore had sold $2.2 billion of convertible 5 percent bonds, its first such offering, saying the debt could be exchanged for shares in the event of an IPO. Zijin Mining invested in those bonds together with BlackRock Inc. (BLK), Government of Singapore Investment Corp. and First Reserve Corp.
Zijin was offering the $175 million of December 2014 bonds at 128.25 percent to 130.25 percent of face value, plus accrued interest, according to the term sheet.
First Reserve, a private equity firm, sold $800 million of the bonds last month at $135,313.89 for each $100,000 of principal amount, and used the proceeds to buy Glencore common stock. Credit Suisse Group AG (CSGN) and Morgan Stanley managed First Reserve’s transaction.
A call made to the Zijin’s office outside of regular business hours wasn’t answered. Simon Buerk, a spokesman for Baar, Switzerland-based Glencore, declined to comment.
Glencore dropped 3 percent to 422.5 pence at the close of London trading, reversing an earlier gain of as much as 2.8 percent.
To contact the editor responsible for this story: Jacqueline Simmons at firstname.lastname@example.org