* Vitol or Mercuria not going for IPO
* Going public means more scrutiny for trading firms
* Say private partnerships motivate owner employees
By Christopher Johnson and Emma Farge
LAUSANNE, Switzerland, April 24 Private
partnerships still offer the best route to growth and
development for most commodity traders, feeding the personal
touch which sustains business, despite the success of Glencore's
share flotation last year, senior traders said on Tuesday.
Glencore raised more than $10 billion via an
initial public offering last May, making six of its directors
billionaires including Chief Executive Ivan Glasenberg, but so
far its rivals have not followed suit.
"We continue to think that a partnership is the best way to
grow our business," Ian Taylor, President and Chief Executive of
energy trader Vitol, told a commodities conference. "We don't
expect Vitol to go for a public share offering in Glencore's
Paul Chivers, group Chief Investment Officer of Mercuria
Energy, another of the world's top five energy traders, agreed:
"That is true for Mercuria as well," Chivers said.
"We are at a different part of our evolution to Glencore."
A public share offering gives access to long-term,
inexpensive capital, but it also means more scrutiny for trading
companies operating in a world with a reputation for secrecy and
deals done behind closed doors.
Vitol's Taylor saw new opportunities for private traders to
tap private equity funds for capital as traders increasingly
sought physical assets such as oil refineries and storage
Taylor said in an interview in February his firm was a
potential buyer of two refining assets in Britain and Germany.
Alex Beard, head of oil at Glencore, told the conference
Glencore's decision to go public was based on its need for
capital in a market that had become increasingly capital
"We felt that if we were going to realise the full potential
for our business ... there was no alternative."
Glencore, already a major producer of commodities including
copper and zinc, became an oil producer late last year with its
Aseng field in Equatorial Guinea, and has signalled interest in
making further acquisitions.
Beard said the culture at Glencore had not changed markedly
since flotation last year.
"The way Glencore operates now is pretty much the same as it
was before the deal," Beard said.
Vitol's Taylor suggested some traders would not welcome the
heavier requirements for disclosure or the amount of effort
needed to treat all shareholders fairly.
"We don't (now) have to spend huge amounts of time with
external shareholders, or with journalists," Taylor said.
Vitol, the world's largest private energy trader which says
it trades about 6 million barrels of oil equivalent every day,
has 360 partners, including many of its key personnel.
Mercuria has also said it believes a private partnership
offers engagement and motivation to its employees, many of whom