MELBOURNE (Reuters) - Glencore has agreed to sell a 9.99 percent stake in its agricultural business to British Columbia Investment Management Corp for $624.9 million, as it continues a push to sell up to $5 billion worth of assets this year to help cut debt.
Glencore Agri would also take on $3.6 billion in debt currently funded by Glencore, the Swiss-based mining and trading firm said, helping to pare debt on Glencore’s books. The debt would be financed without recourse to Glencore.
The deal follows the company’s sale of a 40 percent stake in Glencore Agri to Canada Pension Plan Investment Board for $2.5 billion in April, and will leave Glencore with just over a 50 percent stake in the business, with existing management to stay.
“These transactions highlight the superior value of Glencore Agri, with its advantaged asset footprint and business model, relative to its closest peers,” Glencore Chief Executive Ivan Glasenberg said in a statement on Thursday.
The sale of the agricultural unit stakes plus an agreement to sell a gold deposit in Kazakhstan for $100 million has put Glencore on track to reach its asset sales target as it seeks to cut net debt to between $17 billion and $18 billion this year.
Reporting by Sonali Paul; Editing by Richard Pullin
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