By Christian Moess Laursen

Glencore said it has bought a 77% stake in Canadian miner Teck Resources' steelmaking coal business Elk Valley Resources for $6.93 billion.

The Anglo-Swiss mining giant said Tuesday that the transaction is expected to close in the third quarter of next year.

The Wall Street Journal reported overnight that the companies were nearing a deal, citing people familiar with the situation.

Glencore had originally offered to merge, bidding around $23 billion for the entire company, which would have entailed forming two separate companies for their combined metals and coals businesses, and then later spinning off the merged coal business.

Since, the world's biggest miner by revenue indicated to Teck that it would be willing to buy just its coal business, which Glencore valued at $8.2 billion.

In June, the commodity miner said it would spin off a combined coal company once it had sufficiently reduced its debt, which would be expected up to two years after the transaction closes.

"Glencore continues to believe that a standalone company containing its combined coal and carbon steel materials business, including Glencore's stake in Elk Valley Resources, would be well positioned as a leading, highly cash-generative bulk commodity company, likely attracting strong investor demand given such yield potential," the miner said.

Write to Christian Moess Laursen at christian.moess@wsj.com

(END) Dow Jones Newswires

November 14, 2023 02:42 ET (07:42 GMT)

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