The firm is aiming to trade about 1 million tonnes of physical base metals over the next year to 18 months, Metal Bulletin understands.
Since the formation of the company was announced in October, it has signed up Zug, Switzerland-based mining company investment firm Pala, which joins hedge fund Ospraie Management and precious metals firm MKS Pamp Group as an equity investor.
“We are open for business, and I believe well-capitalised, prepared, and with a very experienced team of traders and staff in London, New York and Hong Kong. Our team are all grateful for the support of our experienced shareholders and board members, as we begin to offer merchant services in the major metals at a time in the price cycle when we can help optimise marketing and product flow for producers to global consumers,” chief executive Mark Hansen, formerly Noble’s head of base metals, told Metal Bulletin.
“Supply is available and there is also a willingness to work with new companies that maybe was not there earlier in this cycle, which is helpful.”
Concord plans to specialise in the base metals markets that its staff know best and to focus on managing a profitable trade flow in an efficient manner that is beneficial to its counterparties.
The company will start by trading refined copper, aluminium, zinc, lead and nickel. It plans to add the related raw materials at a slightly later date.
If it develops its business successfully, Concord will look to take minority stakes in companies to secure offtake or access to material flows.
Concord is approaching its full complement of 30 staff at offices in three locations. In London, its headquarters and financial centre, David Freeland runs physical trading, supported by Kazumitsu Futatsuka and concentrates specialist Kareem Barbir. Head of London Metal Exchange trading Paul Wilkes is also based in London.
The two other offices are in New York (where trading is run by Scott Evans, supported by Jeff Romanek) and Hong Kong (run by Paul Chen, supported by Felix Cauro).
Concord’s shareholders, which include senior traders at the company as well as major investors Pala, Ospraie and MKS, have put between $100 million and $200 million into the firm’s equity capital.
The equity capital it has raised is about three times the minimum figure that the firm’s management had in mind, and will be supplemented by relationships with banks.
The establishment of Concord as a limited company, rather than a fund, is intended to enable it to develop long-term relationships with its counterparties and financiers, and to ensure it is not subject to the inflows and outflows that might affect hedge funds that trade metal.
The major shareholders are all represented on the board: Anderson is chairman; alongside him are Michael Barton, who is ceo of Pala, as well as chairman of Sierra Rutile and a director of Nevada Copper; and MKS (Switzerland) SA chairman Marwan Shakarchi.
Executives Hansen and Freeland are also on the board, while Goldman Sachs’ former head of metals, Stephen Branton-Speak, is an independent director.