London-based activist hedge fund Bluebell Capital Partners has criticised Glencore for “a lack of strategic thinking” as it campaigns for the mining conglomerate to spin-off its thermal coal business, according to a story by the Financial Review.
In a letter to Glencore’s board, Bluebell said that “shareholders, us included, would be reasonable in their criticism of this short-sightedness, complacency, and lack of strategic thinking for not spinning off thermal coal in a timely manner”.
Bluebell Capital believes Glencore has wasted 18 months arguing about the proposal before capitulating as part of a takeover of Teck Resources.
Bluebell Capital is a shareholder, through its Active Equity Master Fund ICAV, in both Glencore and Vancouver-based Teck, which is listed in New York and Toronto, and produces coal, copper and zinc.
Glencore is one of Australia’s largest coal exporters and operates 17 mines locally employing some 9900 workers. Bluebell CIO Giuseppe Bivona, a former Goldman Sachs banker, has long maintained these assets are significantly depressing the company’s share price.
Teck last week rejected a revised $US23 billion ($33.8 billion) offer from Glencore, the second in as many weeks. Under Glencore’s proposal, the merged company would divide its assets between a vehicle owning Teck’s copper and zinc mines and its own metal mines and oil trading business, and a second company owning thermal and metallurgical coal mines. Teck this week said a condition of takeover discussions would be for Glencore to spin off its thermal coal mines.
