A new consortium plans to bid for Teck Resources’ metallurgical coal operations, a move that would nullify Glencore’s $23 billion bid to buy the entire company.
Canadian mining investor Pierre Lassonde, chairman emeritus of Franco-Nevada, told the Financial Times on Tuesday that he had assembled a consortium to bid for Teck’s entire coal business.
“Yes, we have a [confidentiality agreement] with Teck and, yes, we have put together a proposal” said Lassonde.
“We haven’t heard from Teck. . . If I had a live proposition in front of me, I’d go back to Toronto and kick my ass,” she added, explaining that he was on his way to Europe.
Lassonde told Canadian newspaper The Globe and Mail on Tuesday about his bid for Teck’s coal-fired unit.
The news is the latest twist in a battle over the company’s future as it tries to fend off an unsolicited offer from Swiss miner Glencore.
Teck’s board of directors repeatedly refused last month Glencore hostile offer to acquire the company, stating that it intends to proceed with its plan to split into a metals business and a separate coal company.
However, Teck was forced into it pull that resolution at the last minute, after failing to garner sufficient shareholder support for the split. The company has said it will look for an “easier” way to achieve the split.
Shares of Teck jumped 5% on the news.
The coal business was valued at $11.5 billion in a recent deal, in which Teck sold a 10% stake in the unit to Nippon Steel, which is also a customer for its metallurgical coal.
Lassonde, a Canadian citizen, has been critical of foreign companies entering the country’s mining sector.
Last month he said he was leading a consortium that would take up to a 20% stake in Teck’s coal business after it spun off from the metals business. Now that the separation plans are frozen, he is instead making an offer to acquire the entire coal-fired unit.
“My number one concern is that this is an asset that should stay in Canada,” Lassonde said. “I saw an opening for a group of investors to be major shareholders in the originally proposed structure. This has been taken off the table and we think there may be a better way to do this, which we have presented.”
Glencore is still pursuing its ambition to buy Teck, but has stopped increasing its offer. The Swiss group says it will present its offer directly to shareholders if Teck’s board of directors continues to refuse to commit.
Teck said he “would not comment on market rumors or speculation.” Glencore declined to comment.
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