Glencore is close to the sale of a large stake in its agriculture business in a deal that would meet a pledge by the miner and trading house to get its balance sheet in better shape amid a sharp downturn in commodity prices.
The anticipated deal, which involves the Canada Pension Plan Investment Board, is central to Glencore's goal of using $4bn to $5bn of asset sales this year to reduce its large debt pile.
The deal would lead to the Canadian pension fund taking a 40 per cent stake in Glencore's agriculture trading unit for about $2.4bn, giving the business an equity value of about $6bn, according to people familiar with the situation. That is lower than some analysts expected and reflects challenging market conditions for agricultural traders.
Plunging commodity prices last year added pressure across the sector and put companies with high debt under particular scrutiny.
Shares in Glencore, one of the world's largest mining groups as well as a trader of resources spanning agriculture, energy and metals, were among the worst performing among leading UK companies in 2015. However, they have risen 60 per cent this year as commodity prices have partially rebounded.