Kazakh businessman buys 39.3% of ERG for $1.4B via Glencore off-take deal
What's the deal? Shakhmurat Mutalip, a Kazakh businessman with little prior mining experience, has acquired a 39.3% stake in Eurasian Resources Group (ERG) — the world's largest high-carbon ferrochrome producer — in a $1.4B transaction. The shares were bought from Patokh Chodiev and the heirs of Alexander Mashkevich, each of whom previously held 20% in ERG. Mutalip's vehicle for the deal is Integra Construction KZ, a Kazakh construction firm.
The purchase was funded through an off-take agreement with GlencoreDealroom has a profile for this one. Try Dealroom → . Under the arrangement, ERG will sell its production to Glencore without immediate payment, with the proceeds effectively financing the share acquisition.
What could go wrong? The financing structure has raised questions about ERG's financial stability. The Glencore off-take deal leaves ERG significantly indebted to the trading giant, with concerns that asset seizures could follow if ERG fails to meet delivery targets.
ERG's balance sheet is already stretched. It carries $5B in debt from Russian state-controlled banks VTB and Sberbank, adding geopolitical and financial risk to an already complex picture.
Meanwhile, Shukhrat Ibragimov — another interested party — retains first-refusal rights on the remaining 40% stake held by the Kazakh government, keeping the door open for further ownership shifts.
The signal: Glencore's role as both financier and off-take partner underscores the mature commodity giant's expanding influence over critical mineral supply chains — a pattern consistent with its corporate investment strategy across coal, copper, nickel, and ferrochrome. With traditional bank financing constrained by geopolitical risk and ERG's $5B exposure to sanctioned Russian lenders, Glencore's willingness to structure creative commodity-backed deals positions it to tighten its grip on global ferrochrome flows at a time when Western supply chain security is under intense scrutiny.
Read more: ainvest.com
