Teck Resources Pushes Back Again on Glencore's Attempts to Court Shareholders in Takeover Bid

By Adriano Marchese

Teck Resources Ltd. offered its shareholders to vote to spin off its steelmaking coal business as Anglo-Swiss commodity mining and trading company Glencore PLC tries to woo Teck shareholders to accept a merger proposal.

The Canadian natural resources company responded to a Glencore statement on early Wednesday, suggesting that the takeover premium that Glencore is proposing continues to undervalue Teck's business.

Teck said the proposal instead is based on a highly volatile share-based consideration and doesn't reflect the value of the base metals portfolio that would come its metals business.

In an open letter early 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.

Glencore's letter was aimed at Teck Class B shareholders, after what it said was the Teck board's consistent refusal to engage with its takeover proposal.

Later on Wednesday, Teck responded that nothing had changed with Glencore's proposal.

"[The proposal offers] same low value, same flawed structure, same material execution risks," Teck said in its statement.

Last week, Teck made its spinoff plans more enticing to shareholders, promising to make changes to its transaction terms to allow for an earlier full separation of Teck Metals Corp. and Elk Valley Resources Ltd.

Glencore has been vying to win shareholder favor when it earlier last week said it would add a cash component to its roughly $23 billion unsolicited merger proposal for Teck that offered shareholders 24% of MetalsCo, the standalone company that would be created in the merger, and $8.2 billion in cash.

Glencore faces an uphill battle to win over Teck shareholders' favor. Teck's controlling shareholder and chairman emeritus, Norman Keevil, has repeatedly backed plans to split Teck and said he supports the board's rejection of Glencore's takeover proposal.

Write to Adriano Marchese at adriano.marchese@wsj.com

(END) Dow Jones Newswires

April 19, 2023 11:24 ET (15:24 GMT)

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