Glencore and BP aim to placate investors

By Rob Davies for the Daily Mail
Updated: 03:24 EDT, 18 April 2011

Commodities trader Glencore and oil supermajor BP are facing twin battles to reassure investors this week, after disgruntled institutions flexed their muscles.

Frosty: BP's CEO Bob Dudley is under pressure to salvage alliance with Rosneft

Glencore will seek to soothe potential investors after concerns about its corporate governance led some to warn it will not achieve the valuation it wants.

The secretive firm is hoping to achieve the largest ever London float with up to 20% of the company due to hit the market, valuing it at up to £45bn.

A listing on that scale would leave several dozen of the firm's top partners holding shares worth more than £150m, while chief executive Ivan Glasenberg could be sitting on stock worth nearly £7bn.

But a week that saw confusion over its chairman and allegations of tax avoidance has led investors to question why their money should be channelled directly to Glencore's top brass.

Standard Life said the firm had cobbled its board together 'at the eleventh hour', warning the float price could suffer as a result.

Separately, BP chairman Carl-Henric Svanberg is also facing increased pressure ahead of the one-year anniversary of the Deepwater Horizon disaster.

Reports emerged at the weekend that one top ten investor has advised BP to double its £19bn asset sale programme, with the aim of creating a sleeker operation with greater growth potential.

And investors have also grown dissatisfied with Svanberg's tendency to maintain a low profile during what has been a nightmare 12 months for BP.

One shareholder at BP's annual meeting last week dubbed the Swede a 'shrinking violet', while several City institutions have expressed private disgruntlement with his detached manner.

BP chief executive Bob Dudley is also under pressure as he tries to salvage an alliance with Kremlin-backed Rosneft, blocked by the billionaires behind joint venture TNK-BP.