ICYMI Teck shareholder urges board to engage with Glencore
On Tuesday, Glencore said it would pay up to US$8.2 billion in cash to Teck’s shareholders who did not want exposure to its thermal coal business. Its press release announcing the new offer did not say how much cash this equated to on a per share basis, but said Teck shareholders could also opt for equity in the fossil fuels company.
“Glencore’s rejected proposal was highly uncertain, dilutive and value destructive to Teck shareholders,” Price said on the call. Teck shareholders will also vote on April 26 on whether to phase out the company’s dual class structure, which endows class A shares with 100 votes apiece and class B shares with one vote, over the next six years. Although class A shares represent approximately one per cent of the outstanding Teck shares, the dual structure has given a few key class A shareholders an outsized voice in Teck’s governance.
Bob Bishop, of New York-based Impala Asset Management LLC, said he controls approximately 120,000 class A shares, which trade at low volumes. He said the Glencore offer, prior to the cash sweetener, did not represent enough of a premium to be attractive to him, and said the April 26 vote to sunset the class A shares would make a huge difference and the split off of the metals business from the metallurgical coal business made sense to him.
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