Teck Resources Rejects Glencore's Takeover Offer.

Teck Resources Ltd.'s board of directors has announced that it has rejected Swiss company Glencore's latest takeover offer. The Canadian mining company made the announcement on Thursday, citing the revised offer as not being in the best interest of shareholders.

Glencore had previously made an unsolicited offer for Teck, which included an all-stock proposal that would have seen Glencore acquire Teck and then split up the metals side of both companies along with parts of Glencore's marketing business into one company, and the combined coal and some other related assets into another company.

However, in a revised offer, Glencore added an $8.2-billion US cash component. The proposal would have seen Teck shareholders receive 24 per cent of the combined metals company, and cash. Despite the increased offer, Teck called the Glencore offer "opportunistic and unrealistic," and the board remains committed to its own plan announced in February to split up its metal and steelmaking coal businesses into two companies, Teck Metals and Elk Valley Resources.

Teck's board chair, Sheila Murray, has stated that the company's own plan "creates a significantly greater spectrum of opportunities to maximize value for Teck shareholders." Murray wrote in a letter to the Glencore board that "Teck has been clear in expressing that it is not in our shareholders' interest to be acquired by Glencore and to merge with your thermal coal or oil trading businesses."

She continued, "As you have now publicly stated you are prepared to spin out your thermal coal business, we suggest you proceed with that, separate your oil business, and then engage with Teck Metals after our own separation has been completed."

Teck is controlled by the Keevil family, which owns the company's class A shares together with Japanese company Sumitomo. Norman Keevil, Teck's chairman emeritus, stated that "now, pre-separation, is not the time to explore a transaction of this nature," and that he has "the utmost confidence in the board's and our management teams' strategy to maximize value for each of Teck Metals' and EVR's shareholders after the separation."

In revising its offer, Glencore acknowledged that certain Teck investors may prefer a full coal exit and others may not desire thermal coal exposure. The cash component was meant to effectively buy Teck shareholders out of their coal exposure. However, Teck shareholders remain set to vote on April 26 on the company's plan to split its operations into Teck Metals and Elk Valley Resources.

Teck's decision to reject Glencore's offer highlights the growing trend of companies choosing to remain independent and pursue their own plans, rather than being acquired by larger companies. In recent years, there have been a number of high-profile mergers and acquisitions in the mining industry, including Rio Tinto's acquisition of Alcan and Glencore's merger with Xstrata.

However, as Teck has shown, not all companies are willing to be acquired, and some prefer to remain independent and pursue their own growth strategies. This trend is not limited to the mining industry, as other sectors have also seen companies choose to remain independent and pursue their own plans, rather than being acquired.

Teck's decision also highlights the importance of shareholder value in the decision-making process of companies. As Teck's board and management team have stated, their own plan to split the company into two separate entities provides a greater opportunity to maximize value for shareholders than Glencore's offer.