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Glencore willing to take Teck Resources bid directly to shareholders

Teck called off separation vote when it became apparent it did not have the required majority
A journalist is silhouetted before the Teck Resources special meeting of shareholders, in Vancouver, B.C., Wednesday, April 26, 2023. THE CANADIAN PRESS/Darryl Dyck

Swiss commodities giant Glencore said it is willing to present its takeover offer directly to shareholders of Teck Resources Ltd. if the company’s board does not come to the negotiating table regarding its unsolicited proposal.

“We believe that with engagement, we could further improve our proposal’s structure, terms and value, which would be in the best interests of all Teck shareholders,” Glencore said in a statement Thursday.

The comments came after Teck repeated its assertion that Glencore’s offer is a “non-starter,” even after the Vancouver-based miner cancelled a key shareholder vote Wednesday on a plan to split its business that Glencore had opposed.

Teck called off the vote when it became apparent it did not have the required two-thirds majority approval from shareholders for the proposal, which would have split the company into Teck Metals and Elk Valley Resources. Instead, the company will pursue what is says will be “a simpler and more direct separation.”

Teck’s board has rejected Glencore’s unsolicited takeover offer that would see shareholders receive a stake in a combined metals company as well as a choice of cash or shares in a company that would hold their merged coal assets.

The proposal represented a 20 per cent premium when it was first made, but Glencore said it believes that if it could talk with the Teck board it could improve its offer and address the issues they have raised.

“Glencore hopes that the Teck board will, against the backdrop of the feedback provided by its shareholders, engage constructively in order to fully explore our proposal which has not been done to date,” the company said.

Teck is controlled by the Keevil family, which owns the company’s class A shares together with Japanese company Sumitomo Metal Mining Co. Ltd.

Teck chairman emeritus Norman Keevil has said Glencore’s proposal is the wrong one, at the wrong time, but that he is open to talking about other possible deals once the company completes its own plan to split its business.

Teck CEO Jonathan Price said Wednesday that said shareholders have made it clear that they still like the idea of a separation and that additional buyers could come forward once Teck splits its coal assets from its metals business.

“We expect there would be significantly more interest in the businesses on a stand-alone basis,” he said. “And that is one of the reasons we continue to believe that separation is the right path forward here.”

READ MORE: Teck Resources cancels shareholder vote on separation plan ahead of annual meeting

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