Teck seeks sale of stake in $8bn coal business
Teck Resources is exploring the sale of a minority stake in its metallurgical coal business as it seeks to take advantage of surging prices for the commodity, people familiar with the matter said.
The Canadian miner has approached parties including smaller rival Arch Resources to gauge their interest in buying a stake of 10% or more in the business, the people said, asking not to be identified as the matter is private.
Teck’s coal business could be valued at about $8-billion, according to the people. Rising demand for the commodity could push that figure higher, the people said. Shares of Teck rose 1.8% at 12:45 p.m. in Toronto after declining as much as 0.8% earlier.
Deliberations for a stake sale are in the early stages and there is no guarantee that a deal could be reached, the people said. A representative for Teck Resources declined to comment, while a spokesperson for Arch Resources didn’t immediately respond to requests for comment.
Teck Resources has been working with an adviser on options for the coal business, including a sale or spinoff, Bloomberg News reported in September.
Large commodity producers are under increasing pressure to cut back on fossil fuels in response to investor concerns over climate change. However, coal prices have surged in recent months as an economic recovery from the coronavirus pandemic has driven up demand for the fuel around the world.
Metallurgical coal is a key raw materials used in steelmaking, which remains one of the most polluting industries on the planet and faces significant pressure from policy makers to clean up its act.
Teck produced more than 21 million metric tons of steelmaking coal in 2020 from four locations in western Canada. The business accounted for 35% of the company’s gross profit, according to its website.
Comments
The
content
you are trying to access is only available to subscribers.
If you are already a subscriber, you can Login Here.
If you are not a subscriber, you can subscribe now, by selecting one of the below options.
For more information or assistance, please contact us at subscriptions@creamermedia.co.za.
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation