(Alliance News) - Glencore PLC's latest bid for Teck Resources Ltd was rebuffed, with the New York-listed firm still preferring to go about its own separation plan.

Teck said an independent special committee of its board said the latest Glencore proposal "is not in the best interests of Teck or its shareholders".

"Glencore has made two opportunistic and unrealistic proposals that would transfer significant value to Glencore at the expense of Teck shareholders," Teck Chair Sheila Murray said. "Teck’s proposed separation creates a significantly greater spectrum of opportunities to maximize value for Teck shareholders. The special committee and board continue to recommend that shareholders vote for the proposed separation into Teck Metals and Elk Valley Resources as the best pathway to fully realize the greatest value

Glencore on Tuesday said it has offered a cash consideration to Teck Resources Ltd shareholders in a bid to get a deal over the line while soothing investor concerns on coal exposure.

It said it offered USD8.2 billion plus a 24% stake in MetalsCo to Vancouver-based miner Teck Resources. MetalsCo would be a transition metals focused business. It would differ from CoalCo, which would be a standalone coal unit.

The modified bid would "effectively buy Teck shareholders out of their coal exposure", Glencore said.

Last week, Teck's board had unanimously rejected an "unsolicited and opportunistic" acquisition proposal from the Glencore.

Glencore had offered 7.78 of its own shares for each Teck Class B subordinate voting share, and 12.73 shares for each Teck Class A common share. This represented a 20% premium for both on the date of the offer.

The proposal from the commodity trader and miner would have seen it buy Teck and then separate to create two businesses, MetalsCo and CoalCo.

Teck had said that the offer was inferior to its own planned separation, which it said better positioned the resulting companies, Teck Metals and Elk Valley Resources, for success.

Tokyo-listed Nippon Steel Corp on Thursday said it has struck a deal with Teck to acquire a 10% stake in Elk Valley.

Nippon Steel said: "Nippon Steel sees strong value creation potential through the establishment of EVR, which is one reason Nippon Steel negotiated the right to acquire additional EVR common shares up to a maximum of 17.5% after closing. Nippon Steel believes that EVR will be a leading pure-play steelmaking coal company in Canada producing high-quality steelmaking coal over the long term, essential for Nippon Steel to achieve its carbon neutrality in the future. Another important factor in our decision to invest in EVR is the fact that EVR's coal mines produce high-quality steelmaking coal, not thermal coal. Nippon Steel has clear and strong concern that combining with thermal coal asset outside Canada may deteriorate the value of EVR's world class steelmaking coal asset."

Glencore shares traded 1.2% higher at 489.55 pence each in London on Thursday morning. In Johannesburg, it traded up 0.7% at ZAR111.32.

By Eric Cunha, Alliance News news editor

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