- Teck Resource (TSX:TECK.A) confirmed Monday its board of directors is rejecting an unsolicited takeover bid by Swiss multinational oil and gas producer, Glencore Plc
- Vancouver-based Teck Resources said it is not contemplating a sale of the company at this time
- The company’s board voted unanimously to reject the bid by London-based Glencore
- An independent special committee of the board determined the proposal is not in the best interests of the company or its shareholders
- Teck Resources (TSX:TECK.A) is up 15.89 percent, trading at $$57.19 at 10:22 a.m. ET
Teck Resource (TSX:TECK.A) confirmed Monday its board of directors is rejecting an unsolicited takeover bid by Swiss multinational oil and gas producer, Glencore Plc.
Vancouver-based Teck Resources said it is not contemplating a sale of the company at this time.
The company’s board voted unanimously to reject the bid by London-based Glencore, which would have seen Teck split into two separate divisions.
Teck executives said the unsolicited offer carried too high a degree of execution and timing risk.
The company’s shares soared on the news, climbing by as much as 17 percent in early day trading.
The vote came after an independent special committee of the board determined the proposal is not in the best interests of the company or its shareholders.
“The Board is not contemplating a sale of the company at this time. We believe that our planned separation creates a greater spectrum of opportunities to maximize value for Teck shareholders,” said Chair of the Board Sheila Murray said in a statement.
“The Special Committee and Board remain confident that the proposed separation into Teck Metals and Elk Valley Resources is in the best interests of Teck and all its stakeholders, is a much more compelling transaction and does not limit our optionality going forward.”
Teck’s board said any sale would be preceded by a lengthy due diligence process.
“The Glencore proposal would expose Teck shareholders to a large thermal coal business, an oil trading business and significant jurisdictional risk, all of which would negatively impact the value potential of Teck’s business, is contrary to our ESG commitments and would transfer significant value to Glencore at the expense of Teck shareholders,” Teck CEO Jonathan Price said in a statement.
The unsolicited proposal would have consisted of an all-share acquisition with Glencore offering 7.78 shares for each Teck Class B subordinate voting share and 12.73 Glencore shares for each Teck Class A common share. That would have represented a 20 percent premium.
Teck Resources (TSX:TECK.A) is up 15.89 percent, trading at $$57.19 at 10:22 a.m. ET.
