Teck set to sell majority stake in coal unit to Glencore

Bengaluru — Canada’s Teck Resources is planning to sell a majority stake in its steelmaking coal unit to Glencore, while Asian steelmakers Nippon Steel and Posco will buy the rest in an overall $8.9bn deal, the Globe & Mail reported on Monday.

Glencore will pay $6.9bn for a 77% stake in Teck’s coal unit, while Japan’s Nippon Steel will pay $1.7bn and swap its interest in one of Teck’s coal operations for 20% of the coal business, the report said, citing sources.

South Korea’s Posco will swap its interests in two of Teck’s coal operations for 3% of the business, the report said, adding that the deal could be announced as soon as Tuesday.

The Wall Street Journal first reported that Glencore and Teck were in advanced talks on a deal that would value Teck’s coal assets at close to $10bn.

Glencore and Nippon Steel declined to comment. Teck and Posco did not immediately respond to a request for comment.

Teck has been considering splitting its coal and copper businesses since March. In April, it rebuffed a $22.5bn unsolicited takeover offer for the entire company from Glencore.

The Vancouver-based company has twice rejected an unsolicited $22.5bn bid for the entire company from Glencore. The company said in July it had received offers from “various” interested parties for its coal business.

Reuters