Glencore's Pursuit of South Africa's Chrome Empire

For over a decade, billionaire Ivan Glasenberg has been obsessed with acquiring Glencore Plc's long-held dream: control of the lucrative chrome industry in South Africa. The coveted asset has been at the center of a high-stakes battle between the British-Swiss mining giant and local players.

A Decade-Long Quest

Glencore, founded by Glasenberg and his partners in 1974, has built its reputation on its extensive network of mines, refineries, and trading operations. The company's diverse portfolio spans commodities like copper, cobalt, and nickel, as well as agricultural products and metals.

The chrome industry, however, remains the holy grail for Glencore. Chrome is a critical component in steel production, making it an essential material for the automotive and construction sectors. South Africa, with its vast reserves of chromium ore, has been the hub of the global chrome market for decades.

BHP's Initial Foray

In 2011, BHP Billiton, another leading mining corporation, made a surprise move to acquire Glencore's 45% stake in the South African chrome mine, Vereniging. The deal was worth approximately $3.4 billion and marked a significant blow to Glasenberg's ambitions.

Glencore's Resurgence

Undeterred by BHP's initial foray, Glencore redoubled its efforts to secure control of the chrome industry in South Africa. In 2018, the company acquired Sibanye-Stillwater's (SNSJ) 60% stake in the Vereniging mine, increasing its hold on the asset.

Local Resistance

However, not all stakeholders are eager to see Glencore dominate the chrome market. Local South African companies and industry players have expressed concerns about the potential impact of foreign ownership on the domestic economy.

State-Owned Enterprise (SOE) Opposition

In particular, the South African government's state-owned enterprise, Sibanye-Stillwater, has opposed Glencore's acquisition of its chrome assets. The company argues that a change in ownership would disrupt operations and undermine local employment opportunities.

Regulatory Hurdles

Despite Glencore's efforts to secure control of the chrome industry, regulatory hurdles have remained an obstacle. In 2020, the South African Competition Tribunal (SACT) blocked Glencore's acquisition of Sibanye-Stillwater's chrome assets due to concerns about anti-competitive practices.

Glasenberg's Unyielding Resolve

Despite these setbacks, Ivan Glasenberg remains resolute in his pursuit of control over the chrome industry. The billionaire has stated that he is willing to continue investing and expanding Glencore's presence in South Africa, even if it means facing regulatory challenges.

The Future of Chrome

As the global demand for steel continues to rise, the chrome industry will remain a critical component of the supply chain. Will Glencore ultimately succeed in its bid to dominate the South African chrome market? Only time will tell, but one thing is certain: the battle for control over this lucrative commodity has only just begun.

Key Players

• Ivan Glasenberg: Founder and CEO of Glencore Plc
• BHP Billiton: Leading mining corporation with a significant stake in the South African chrome market
• Sibanye-Stillwater: State-owned enterprise and local player in the chrome industry
• South African Government: Regulator of the chrome industry, with oversight over state-owned enterprises like Sibanye-Stillwater

Timeline

• 1974: Glencore founded by Ivan Glasenberg and partners
• 2011: BHP Billiton acquires Glencore's stake in the Vereniging mine
• 2018: Glencore acquires Sibanye-Stillwater's chrome assets
• 2020: South African Competition Tribunal blocks Glencore's acquisition of Sibanye-Stillwater's chrome assets