Teck Separation Plans Supported by Shareholder Sumitomo
April 20 2023 - 9:44AM
Dow Jones News
By Robb M. Stewart
Teck Resources Ltd. has secured support for its plan to split in
two from one of its biggest shareholders, Sumitomo Metal Mining
Co., presenting a hurdle to Glencore PLC's bid to buy the Canadian
miner.
Tokyo-based Sumitomo said Thursday it will vote in favor of
Teck's move to separate its steelmaking coal business from the base
metals operations at the shareholders meeting set for next
Wednesday.
Sumitomo said it has since 1997 built a trusted partnership with
Teck, beginning with joint exploration at the Pogo gold mine in
Alaska through development of the mine, to a move in 2018 by
Sumitomo to buy an indirect 25% stake in the Quebrada Blanca copper
mine in Chile where phase two of its development is underway. The
company owns almost 19% of Teck's Class A shares, and a 49% stake
in Canada's Temagami Mining Co., which holds 55% of the A
shares.
Early in the week, controlling shareholder and chairman emeritus
Norman Keevil said he fully supports the Teck board's rejection of
the takeover proposal from metals and mining giant Glencore, and
noted there are numerous parties in the mining industry with their
eyes on Teck that would be interested in partnering or investing in
the company after it separates its operations.
The Keevil family together with Sumitomo control a combined
about 48% of the total voting power over Teck via the A shares.
In an open letter Wednesday, Glencore said it is prepared to
engage with Teck's board to consider improvements to its takeover
proposal, but that it is also prepared to go directly to Teck's
shareholders with its takeover offer.
Glencore's letter sought to win over holders of Teck's Class B
shares. Last week, it said it would add a cash component to its
roughly $23 billion unsolicited merger proposal that offered
shareholders 24% of MetalsCo, a standalone company that would be
created in the merger, and $8.2 billion in cash.
Teck has rejected Glencore's approach as opportunistic and
continues to urge its shareholders to support its separation
plans.
Write to Robb M. Stewart at robb.stewart@wsj.com
(END) Dow Jones Newswires
April 20, 2023 09:29 ET (13:29 GMT)
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