Teck Resources Ltd.’s shares jumped Monday after the mining company’s controlling shareholder and chairman emeritus backed plans to split Teck in the face of a takeover bid from Glencore PLC but said he wouldn’t stand in the way of possible dealmaking after the separation.
In morning trading, the shares were 5.4% higher at C$63.71 on the Toronto Stock Exchange, widening the advance so far this year to 24%. In New York, the stock was ahead 4.7% at $47.35.
Norman Keevil in a statement said he fully supports the Teck board’s rejection of the takeover proposal from metals and mining giant Glencore. Mr. Keevil noted there are numerous parties in the mining industry with their eyes on Teck that would be interested in partnering or investing in the company after it separates its base metals and steelmaking coal businesses.
“I would support a transaction–whether it be an operating partnership, merger, acquisition, or sale–with the right partner, on the right terms for Teck Metals after separation,” Mr. Keevil said, adding that pursuing a sale or merger transaction now would take away significant post-separation value from shareholders.
The Canadian company last week rejected a revised roughly $23 billion merger offer from Glencore, saying that its own plan to split into two independent companies was in the best interest of its shareholders. In rebuffing the approach, Tech said a deal with Glencore would limit its ability to potentially seek other buyers, would expose the company to regulatory risk from antitrust authorities and would take too long to complete.
Teck shareholders are set to vote April 26 on the company’s plan to split into two.
The Keevil family along with Japan’s Sumitomo Metal Mining Co. control a combined about 48% of the total voting power over Teck via ownership of its Class A shares.