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Glencore faces lawsuits over U.S. subpoena, stock drop

Reuters  |  NEW YORK 

By Jonathan Stempel

(Reuters) - Plc faces at least two lawsuits by shareholders accusing the big Anglo-Swiss company of having made false and misleading disclosures before it received a subpoena in a corruption probe, and its stock tumbled.

The lawsuits were filed on Monday with the District Court in Newark, New Jersey, and on Wednesday after market hours with the District Court in Manhattan.

They accused of concealing how its conduct would subject it to heightened regulatory scrutiny into its compliance with money laundering and bribery laws, including the U.S. Foreign Corrupt Practices Act.

did not immediately respond after market hours on Wednesday to requests for comment.

is a defendant in both lawsuits, and is a defendant in the lawsuit.

Glencore's U.S.-listed shares fell 9 percent on July 3 after the company disclosed having a day earlier received a subpoena concerning its operations in the Democratic Republic of Congo, and

On Wednesday, Glencore said it would cooperate with the Justice Department and had set up a board committee, including and former Tony Hayward, to oversee its response.

Some analysts have said the subpoena might have resulted from Glencore's settling of a dispute in with Israeli billionaire Dan Gertler, under U.S. sanctions since last year, by agreeing to pay royalties in euros.

Analysts have said accounts for about 25 percent of Glencore's net present value.

Glencore mines cobalt, a key ingredient in batteries for electric vehicles, in the central African country.

Both lawsuits seek unspecified damages for shareholders, who hope to pursue their claims as groups in class actions.

It is common for shareholders to file U.S. lawsuits accusing companies of misleading them about their businesses and saying that their stock prices declined once the truth came out.

The cases are Church v et al, U.S. District Court, District of New Jersey, No. 18-11477; and Robison v et al, U.S. District Court, Southern District of New York, No. 18-06286.

(Reporting by Jonathan in New York; Editing by Cynthia Osterman)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, July 12 2018. 06:04 IST