Ivan Glasenberg, who built Glencore Plc into a dominant force in commodities trading and became the face of the industry, told investors he plans to retire in three to five years, according to people familiar with the matter.<\/p>\n
Glasenberg discussed his succession plan in recent meetings and said he has started training three to four front runners as the next chief executive officer, said the people, who asked not to be identified because the conversations were private.<\/p>\n
Glasenberg, who turns 62 in January, anticipates retiring between the ages of 65 and 67, and believes the next leader should come from a younger generation, the people said. A spokesman for Glencore declined to comment.<\/p>\n
The comments put a timeline on the chief executive\u2019s exit for the first time and force investors to consider what had long seemed unthinkable: a Glencore without Glasenberg. The brash, workaholic South African started his career at Glencore more than three decades ago, and has held the top job since 2002.<\/p>\n
But Glasenberg\u2019s age and the announcement earlier this year of a US investigation into Glencore\u2019s dealings in the Democratic Republic of Congo have spurred questions on succession planning from investors and analysts.<\/p>\n
Common Question<\/strong><\/p>\n Jefferies LLC analysts said in a note dated Oct. 15 that it was “a common question from investors” whether the probe by the US Department of Justice would lead to management changes.<\/p>\n In the past, Glasenberg said he\u2019d stay until being pushed out by a younger, hungrier trader in Glencore\u2019s dog-eat-dog culture. In 2013, he told Bloomberg News there were no talks about succession.<\/p>\n \u201cThere\u2019s a good set of guys underneath me,\u201d Glasenberg said at the time. \u201cI think any one of them could take over at some stage in the future. I\u2019ve always said I am staying around as long as they want me there and none of them want my job. So right now I\u2019m here, so I ain\u2019t going anywhere.\u201d<\/p>\n In recent investor meetings, Glasenberg didn\u2019t disclose the shortlist of candidates, according to people with knowledge of the discussions. But he said that whoever takes over should be younger than the top executives who took the company public in 2011.<\/p>\n Old Guard<\/strong><\/p>\n That points to a generational shift from Glasenberg\u2019s most senior lieutenants at Glencore, such as Telis Mistakidis, head of copper trading, Daniel Mate, head of lead and zinc trading, Tor Peterson, head of coal trading, and Alex Beard, head of oil.<\/p>\n “There\u2019s no obvious name outside the old guard,” said Ben Davis, an analyst at Liberum Capital Markets. “The next rank down are totally invisible to us.”<\/p>\n Still, some industry observers see Glasenberg\u2019s comments as designed to placate investors concerned about the lack of obvious succession planning. There is doubt the executive will leave any time soon.<\/p>\n “I can see a Glencore without Ivan, but I don\u2019t expect that within a four-year time frame,” said Davis.<\/p>\n Even so, a generational shift is already underway. Stuart Cutler, who has run ferroalloys trading since 2005, is due to retire at the end of this year. Mistakidis, the head of copper trading, is under pressure amid investigations into Glencore\u2019s copper business in Congo.<\/p>\n The trading house has only changed leaders twice in its 44-year history. In 1994, founder Marc Rich was pushed out after a failed attempt to corner the zinc market and Glasenberg took over from Willy Strothotte in 2002.<\/p>\n The eventual leadership change also presents another risk. Glasenberg and the next half-dozen most senior employees own about 20 percent of Glencore\u2019s shares, according to a Bloomberg estimate based on the company\u2019s most recent disclosures.<\/p>\n In the recent investor meetings, Glasenberg said he won\u2019t sell his shares after retiring, the people said. He\u2019s the company\u2019s second-largest shareholder with a 8.6% stake that\u2019s worth $5 billion.<\/p>\n
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