Gary Nagle

GARY Nagle continues to look a winner during his third year running Glencore, although the group’s share price has suffered during the past 12 months along with its peers like BHP and Anglo American. Glencore in December was down 26% on its high of just over 500p set in May, reflecting commodity market downturns and the net loss recorded at the interim stage. That stands in sharp contrast to the share price gains of the two previous years. 

Nagle last year also won Glencore’s confrontation with Canadian group Teck by acquiring a 77% stake in Elk Valley Resources (EVR). He then showed that he was receptive to his shareholders’ views and opted to retain the group’s coal assets instead of the original plan of combining them with those of EVR and demerging them. The reason was the expected substantial cash flow from the coal operations, which could be used to finance growth options in priority commodities like copper. Nagle noted that “ongoing cuts” to global copper production continued to highlight the supply challenges facing that industry. 

He also emphasised “potential top-up shareholder returns” above base cash distributions because of the coal cash and the money coming in from the disposal of non-core assets like Viterra. Clearly, he is well aware of the need to keep his shareholders happy with acceptable returns. Speculation in January Glencore discussed a merger with Rio Tinto last year hints at two things: first, Glencore remains open to transformative dealmaking and secondly, that the search for metals supply is intensifying.