Magazine article Modern Trader

Phibro Restructures; Suit Filed

Magazine article Modern Trader

Phibro Restructures; Suit Filed

Article excerpt

In a rough couple of months for Phibro Inc., the company announced it will undergo a major reorganization that is expected to pull them out of cocoa and other softs trading. In a separate development in January, Phibro was named in a lawsuit that charges the firm with manipulating the silver market in late 1997.

Phibro declined to comment on either event, and a spokesperson at Salomon Smith Barney, of which Phibro is a trading arm, would only confirm a reorganization is expected in the first half 1998. Phibro, one of the world's largest players in cocoa trading, is trying to unwind 300,000 tons of cocoa, sources say. As Phibro exits, analysts expect ADM and Cargill to absorb the position and stifle any long-term fallout from Phibro's absence.

"This 300,000 [tons] has been kind of a background issue for at least a year and a half," says Anne Prendergast, cocoa analyst with Refco in New York. "I suppose it could be a big factor, but it would not be in Phibro's interest to have this cause prices to fall. …

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