Sale of Teck's steelmaking coal business to Glencore approved

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The Teck Resources logo is seen on a podium before the company's special meeting of shareholders in Vancouver, B.C., Wednesday, April 26, 2023. The company allowed media to attend the meeting but not take photographs or record audio or video of the proceedings once the session began.

Industry Minister François-Philippe Champagne said the green light comes with "strict" conditions and represents a "much narrower" transaction than Glencore's hostile takeover attempt of Teck last year.The Canadian PressThe Teck Resources logo is seen on a podium before the company's special meeting of shareholders in Vancouver, B.C., Wednesday, April 26, 2023. Ottawa has approved the sale of Teck's steelmaking coal business to Glencore.

The Vancouver-based miner said it expects to receive $9.5 billion from the sale, excluding closing adjustments. The company has four near-term copper projects that it estimates would together cost about $4.7 billion to complete, while it's also working to ramp up production at its roughly $8.7 billion US Quebrada Blanca Phase 2 project in Chile.

The conditions also include ensuring the majority of Elk Valley Resources' directors, and two-thirds of its executives or senior managers, are Canadian for the same duration. The Glencore headquarters in Baar, Switzerland is shown in an April 14, 2011, file picture. Ottawa said Glencore has also agreed to "maintain significant employment levels" at Elk Valley Resources for at least five years. THE CANADIAN PRESS/AP-Urs Flueeler/Keystone via AP

The announced deal also included Japanese company Nippon Steel Corp. acquiring a 20 per cent stake in exchange for its interest in one of Teck's coal operations and US$1.7 billion in cash, while South Korean steelmaker Posco would swap its interest in a pair of Teck's coal operations for a three per cent stake in the overall steelmaking coal operations.

 

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