Teck Resources Ltd. said it’s engaging with Glencore Plc’s offer to buy its steelmaking coal business for cash, the latest twist in the takeover saga for the Canadian miner.
Glencore’s proposal is preliminary and non-binding, Teck said Monday in a statement.
Glencore has so far been thwarted in its attempts to buy all of Teck, with the Canadian miner refusing to engage. Glencore had proposed merging the two companies’ metal businesses and creating a new coal-mining unit in a $23 billion deal. Glencore said Monday it hasn’t given up on its plans to buy all of Teck.
Teck and its controlling shareholder have repeatedly rejected Glencore, which launched a successful lobbying campaign against Teck’s plan to split its business. Teck in turn has sought to come up with a new plan to separate its coal business and said last week that it had received several proposals for deals involving its coal operations.
Glencore’s previous offer valued Teck’s coal business at $8.2 billion. It did not give a valuation for its current offer. Glencore said Monday that should a deal be done it would spin off its own thermal coal operations combined with Teck’s steelmaking coal mines.
Glencore has come under increasing pressure for its continued ownership of coal mines from its investors, with almost 30% of shareholders backing a resolution urging the company to explain how its thermal coal business aligns with efforts to limit the increase in global temperatures to 1.5C.
