Teck Resources Drops Separation Plans, Will Seek Simpler Approach to a Split

By Robb M. Stewart

Teck Resources Ltd. has dropped plans to split the resources company in two and said it would instead seek a simpler approach to a separation.

The Canadian mining company's board said strong support was received from shareholders for a separation aimed at unlocking value by splitting the steelmaking coal operations from the base metals business, but it also heard that some investors would prefer a more direct approach to a split. Teck said the company aims to incorporate feedback into its revised plans.

The company said in the interim it continues to ramp up its flagship Quebrada Blanca Phase 2 copper project in Chile to full production while it advances a pipeline of copper projects and looks to optimize production at existing operations.

Teck's shareholders were scheduled to vote on the proposed separation at the annual meeting Wednesday.

The company had the support for the split from its controlling shareholders, chairman emeritus Norman Keevil and Japan's Sumitomo Metal Mining Co., who collectively account for 48% of the total voting power over Teck via the company's A shares.

Teck had rejected a takeover bid from metals and mining giant Glencore PLC, which has said it remains prepared to engage with Teck's board but is also considering going directly to shareholders with its roughly $23 billion proposal.

"Glencore's rejected proposals remain a non-starter, with the same flawed structure and material execution risks identified by our board," Teck Chief Executive Jonathan Price said.

Teck shares were up 6.5% at $46 on the New York Stock Exchange in premarket trade.

Write to Robb M. Stewart at [e-mail]

(END) Dow Jones Newswires

April 26, 2023 09:38 ET (13:38 GMT)

Copyright (c) 2023 Dow Jones & Company, Inc.