LONDON (Reuters) – Glencore on Tuesday proposed introducing a cash component to its takeover offer of Teck Resources and urged the board to delay an impeding shareholder vote on its restructuring plan.
Canada’s Teck on Monday reinforced its rejection of the unsolicited $22.5 billion Glencore bid, which includes a plan to simultaneously spin off the companies’ thermal and steelmaking coal businesses and rebrand the remaining company as GlenTeck.
Teck Chief Executive Jonathan Price said that instead a proposed restructuring in which his Vancouver-based miner would spin off its steelmaking coal unit to focus on copper and other industrial metals is the only viable option.
Glencore now proposes that Teck shareholders would receive 24% of the combined metals group and up to $8.2 billion in cash to those who may not wish thermal coal exposure.
Teck had said in its rejection that it did not want to expose its shareholders to thermal coal, the most polluting fossil fuel.
Teck Resources did not immediately respond to a request for comment.
Reuters on Monday reported that Chief Executive Gary Nagle plans to meet with some of Teck’s Canadian shareholders in Toronto this Thursday to personally lobby them for support of their bid.
“We believe that it is in your shareholders’ interests to engage with Glencore and we see no valid reason not to delay your shareholders meeting in respect of the Proposed Teck Separation in order to allow for discussions and due consideration of our Proposed Transaction,” Nagle said in its letter to the board of Teck.
A shareholder vote on Teck’s restructuring plan is scheduled for April 26. If it passes, the separation process will then take 7-8 weeks to complete.
(Reporting by Clara Denina and Muhammed Husain; Editing by Shailesh Kuber and Mark Porter)
