Glencore IPO Pushes Ex-Fugitive Billionaire Marc Rich Out Of The Shadows Page 1 of 5

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Clare O'ConnorForbes Staff

Women entrepreneurs and workplace equality.

LISTS 5/23/2011 @ 3:30PM 12,438 views

Glencore IPO Pushes Ex-Fugitive

Billionaire Marc Rich Out Of The
Shadows
In the
run-up
to last
weeks
much-
hyped
IPO,

GUIDO ROEOESLI/AFP/Getty Images

commodities giant Glencore appeared to make a

concerted effort to distance itself from its
founder, the infamous one-time fugitive Marc
Rich. Glencores IPO prospectus ran 1,637 pages
long, but the companys original name Marc
Rich & Co was mentioned just three times. A
search for Richs name on the website of the
newly-listed firm brings up zero results.

Its no great shock that Glencores billionaire

executives are keen to avoid association with
Rich. He was famously charged with illegally
trading oil with Iran during the 1980s hostage
crisis, as well as evading more than $48 million
in taxes. He fled to Switzerland in 1983 as a
fugitive, and hasnt returned to the U.S. since,
despite being pardoned by then-president Bill
Clinton in 2001. Marc Rich & Co was sold to
management in 1994, changing its name to
Glencore. Rich then went silent, and given a
lack of information and evidence Forbes
dropped him from our Forbes 400 rich list in
2010.

Richs one-time underlings at Glencores helm

might not be thrilled to hear that the infamous
traders name is set to hit headlines again, despite
the IPO being done and dusted. Hollywood
hitmakers Brian Grazer and Ron Howard of
Imagine Entertainment plan to turn the Rich saga

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into a movie, based on the 2009 book by Swiss

journalist Daniel Ammann, The King of Oil: The
Secret Lives of Marc Rich. Ammann was granted
60 hours of face time with Rich, who hadnt
spoken to the press in almost 20 years. Imagine
and Ammann havent finalized a deal but it is
thought to be weeks away.

While Glencore has done its best to play down the

Rich connection, the former fugitive was unable
to resist giving his two cents prior to the IPO.
Earlier this year, Rich sat down once again with
Ammann for his first newspaper interview in
decades, for Swiss weekly Die Weltwoche. The
Q&A, conducted on the 10th anniversary of
Clintons pardon, is excerpted and translated at
the bottom of this post, courtesy of Ammann. In
the interview, Rich says hed have kept Glencore
private if the choice was still his. To Ammann,
that stance is wholly unsurprising.

I write in my book that Rich became rich not

least by buying oil from Iran and selling it to its
arch-enemy Israel, and all parties involved knew
about it, Ammann told FORBES. Such trades
would not, and will not, be possible for a public
company.

Rich heaped praise on Glencore chief Ivan

Glasenberg, who became a multi-billionaire when
the firm went public, calling him brilliant and
adding that he plans to buy shares in Glencore.
He also told Ammann that he made money
overall on his investments with Madoff, and that
despite missing New York he wont return to
the U.S., fearing federal agents will come up with
something else and attack [him] again. The 76-
year-old also made light of rumors that his health
is failing, telling Ammann: reports of my death
are greatly exaggerated.

Marc Rich

on Glencore:

Q: You sold your company in 1993 to the

management, which renamed it to Glencore. Are
your successors doing a good job?
A: Glencore is a very well managed company. It is
the best company of the industry.

Q: What do you think of its CEO Ivan

Glasenberg?
A: Ivan Glasenberg is a brilliant man. I hired him
in 1984 as a Junior Trader. He worked in our coal
department in South Africa. I liked him from the
start. He is intelligent, he is analyzing well, he is
very hard working and he has an impressive
presence. He is the strong man of the company,
no doubt.

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Q: Are the plans of Glencore to go public a good

idea?
A: We will see.

Q: If Glasenberg asked you: Marc, should we go

public or not? What would you answer?
A: I would be positive, yes. They probably dont
have a choice. Transparency is requested today. It
limits your activity, to be sure, but its just a new
strategy to which they have to adapt to.

Q: If you were still the owner, would you go

public?
A: I personally would rather not.

Q: Why not?
A: It is much more convenient not to be a public
company. As a private company you dont have to
give information to the public. Secrecy is an
important factor of success in the commodity
business. We liked to remain closed and secret. It
was a business advantage. Our business partners
felt better that way too, I think.

Q: What are the motives of Glencore to go public?

A: I basically see two reasons for a going public:
Glencore gets access to more money. It is a way of
funding your business and to finance growth.
Plus: You have more liquid shares. It is easier to
leave the company and redeem your shares. The
going public may also be an exit strategy for the
top management. It is always good to leave at
good times.

Q: Will you buy shares?

A: Yes. The human resource at Glencore is
fantastic.

Q: What an irony: You sell your company and

many years later you buy its shares.
A: You see: Im flexible.

on Madoff:

Q: How was this scheme possible?

A: I was amazed, when I heard about it. Im still
surprised

Q: You were one of Madoffs investors. Why did

you trust him?
A: My business partner Alec Hackel went to New
York once especially to visit him. Alec came back
with a positive report and said Madoff gave a
good impression. Then we invested. But about
three months before Madoffs scheme collapsed I
got the feeling I should get out and we got out
with everything.

Q: Why did you have this feeling?

A: I just had the feeling. I sent my advisors to see
Madoff and to check on his business model. They
came back and told me: We dont understand

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whats happening. They dont let us have enough

information. Its too good to be true. That was
the signal to redeem our investment. Overall it
was a good investment.

Q: You lost 10 to 15 million dollars to Madoff.

A: This loss stemmed from an indirect
investment. Overall we made money.

Q: How much money did you invest before

pulling out?
A: I was actively managing the portfolio, at times
it was more, at times it was less. At the peak it
was a high double digit million dollar investment.

Q: Did you sue Madoff?

A: No. Whats the sense?

Q: To get the money back.

A: There is no chance to get anything back.

Q: Why did experienced investors trust him?

A: He seemed to be very successful, he was
Jewish, people felt comfortable with him. Greed
may have played a role. Some people were
blinded by a return of 30 percent.

on his pardon:

Q: Exactly 10 years ago President Bill Clinton

pardoned you. How did it impact your life?
A: It made me feel free. I can travel, I can move.
Before the pardon I had to be very careful not to
be caught by American agents. And I can assure
you: I was very careful.

Q: The pardon was worth it?

A. Absolutely, why do you ask?

Q: In a way it backfired. You were back in the

headlines very negatively as the biggest tax
fraudster in American history, as a traitor of the
country who did business with Iran.
A: It didnt bother me.

Q: Have you been back to the USA since the

pardon?
A: No, and I dont plan to.

Q: Why not?
A: Im afraid they will come up with something
else and attack me again.

Q: Would you like to go back to the USA?

A: If there wasnt this problem I would like to go
there, for sure. I miss New York. I like the country
and I like the people. However, the U.S. political
and legal system is prone to overreaction.

on President Barack Obama:

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Q: Two years ago you put great hopes in a

President Barack Obama. Your assessment
today?
A: George W. Bush was a very bad president. The
Iraq war was a big mistake. The USA needed a
political change. I hoped Barack Obama could be
a good president, but Im disappointed. He hasnt
done well.

Q: What should President Obama have done

better?
A: Almost everything. He made too much empty
promises that costed money and cant be
financed. The US cant afford anymore to spend
more than they earn.

On his health:
Reports of my death are greatly exaggerated.

Follow me on Twitter: @Clare_OC

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