Glencore Becomes Material Atlas Iron Shareholder -- Update

   By Rhiannon Hoyle 
 

SYDNEY--Glencore PLC (GLEN.LN) said it has gained a new source of iron ore for its marketing business as it becomes a substantial shareholder in Australian miner Atlas Iron Ltd. (AGO.AU).

Last year, Glencore bought some of Atlas Iron's debt, a portion of which has now been converted to shares under a restructure of the Australian company. Consequently, Glencore-controlled Maru Sky Ltd. holds an 8.5% stake in the company, according to a regulatory filing Monday.

Atlas Iron has been struggling to stay afloat amid a sharp downturn in world iron-ore markets. The company was worth nearly 4 billion Australian dollars (US$3.0 billion) as recently as 2011 but has been losing money rapidly as iron-ore prices fell to a decade-low, underpinned by a swelling global glut of the steelmaking ingredient.

Glencore said it has secured marketing rights for a portion of Atlas Iron's exports, which are forecast to total up to 15 million metric tons in the year through June. "Glencore is a significant global marketer of iron ore, though we do not produce it ourselves," Glencore said.

Write to Rhiannon Hoyle at [e-mail]

(END) Dow Jones Newswires

May 09, 2016 03:02 ET (07:02 GMT)

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