Teck opted for coal split after mulling stake sale, partnerships
Teck Resources spent four years mulling options for its steelmaking coal business before deciding to separate it from its base metals operations.
Canada’s largest diversified miner started weighing a spinoff in 2019 after noticing a change in investor attitudes toward coal, according to corporate filings released Monday.
The C-suite heard presentations from bankers and consultants and considered options that included a joint venture, selling a minority stake and a sale to private equity. After dozens of meetings, the board and management decided in February that the best option was to separate the coal division and keep a stream of its cash flow.
The plans to separate the lucrative coal business now face a potential obstacle after Swiss commodities giant Glencore proposed a $23-billion takeover of the Vancouver-based company on March 26. Teck rejected Glencore’s pitch on Monday and said it will forge ahead with a shareholder vote set for April 26 to approve its plan to split the company’s two main businesses.
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