Listen to this article
Give us your feedback Thank you for your feedback.
What do you think?
Glencore has formed a joint-venture company to invest in mining royalties around the world, in a deal that gives the Switzerland-based miner greater access to a diverse supply of metals.
BaseCore Metals is a 50:50 joint venture with the Ontario Teachers’ Pension Plan and will be seeded with $300m of royalties from Glencore from its mines in North and South America.
The deal will help Glencore secure additional supplies of copper, cobalt, nickel and zinc for its giant trading division, which has long set it apart from rivals in the mining industry.
“The creation of BaseCore Metals is unique in the sector and will enable us to secure further offtakes for our marketing business,” Ivan Glasenberg, chief executive of Glencore, said.
Royalties and streaming transactions — acquiring long-term rights to buy metal from mines in return for an upfront payment — have become big business in recent years as cash-strapped producers have struggled to secure financing and raise capital. Others companies active in the space but focused specifically on base metals include Anglo Pacific and Franco-Nevada.
Both Glencore and Ontario Teachers’ Pension Plan will have the right to nominate directors to the board of BaseCore Metals, the companies said.