Glencore plans to sell copper mines in Australia and Chile as the mining and trading company aims to reduce a debt burden accumulated in an asset buying spree. As Laura Frykberg reports Glencore's problems have shaken confidence in the Swiss-based firm.
A mining giant with a mountain of debt. Glencore says it's selling two of its copper mines - one in Australia, the other in Chile. The sale is aimed at reducing the 30 billion dollars it owes by a third. Debt which is just a drop in an ocean of problems for Glencore, according to BGC Partners Market Analyst, Mike Ingram. (SOUNDBITE) (English) BGC PARTNERS MARKET ANALYST, MIKE INGRAM, SAYING: "Ultimately this isn't necessarily about the amount of debt the company is carrying but the operational leverage to commodity prices and until we see some further visibility - and preferably from Glencore's point of view - some upside on those commodity prices then we are going to continue to see Glencore's stock under pressure." News of the sale saw the price of copper rise on Monday. Relief for investors after the company's share price slumped by one-third late last month. Or maybe not? (SOUNDBITE) (English) BGC PARTNERS MARKET ANALYST, MIKE INGRAM, SAYING: "Ultimately it depends on where the very commodity-hungry parts of the global economy are going - China is clearly at the epicentre of that." Glencore has also cut copper production and suspended dividend payments to shareholders. It's issuing new shares to raise money too. But it's not out of the woods just yet.