Glencore to raise $11 billion in IPO

Swiss commodities trader, Glencore International AG, has plans to launch around $11 billion in shares in its initial public offering in London and Hong Kong, suggesting a market value of $55 billion to $60 billion.

All existing shareholders will be subject to lock-up arrangements with effect from admission of the IPO.

The global offer is expected to be completed in May 2011.

Glencore, which is privately owned by its management and employees, is selling the shares in the biggest IPO this year with stock markets in the recovery mode and a pick up in commodity prices leading to a tripling in profits at mining companies including Rio Tinto Group.

Meanwhile, China, the world's largest metal consumer, is expected to continue to drive demand as its builds cities and infrastructure.

According to analysts, a primary listing on the London Stock Exchange would raise the company $6.8 billion and $8.8 billion and a secondary listing on the Hong Kong Stock Exchange could raise $2.2 billion, Bloomberg News which obtained a term sheet said. Pricing of shares in the Baar, Switzerland-based company may be announced around 4 May.