Proactive Investors - Billionaire American/Canadian investor Robert Friedland issued a warning on Twitter Tuesday about the danger of letting Teck Resources (TSX:TECKa) get away.
Rather than sell to the Swiss holding company Glencore (LON:GLEN), which is moving in with a $23 billion offer that could get even higher, the Ivanhoe Mines (TSX:IVN) founder said plenty of Canadian investors — including himself — would be interested in getting involved in a potential Teck split.
“I would caution we should NOT lightly sacrifice such a champion at the altar of short-term gain,” Friedland tweeted. “Losing another quintessential Canadian support mechanism to multinationals could corporatise and hollow out our unique ecosystem that has so successfully explored our vast landmass.”
Friedland also questioned the cultural fit between the two companies.
5/ I also have great respect for Glencore as one of the world's leading metal trading houses and mining companies. However, Teck and Glencore have vastly different cultures when it comes to exploration, mine development, and mining operations.— Robert Friedland (@robert_ivanhoe) April 17, 2023
The issue is that Teck Resources has exposure to thermal coal. The most recent Glencore proposal rejected by Teck last week would’ve given Teck's shareholders 24% of the proposed combined metals company and up to $8.2 billion in cash for those who may not want exposure to thermal coal.
Teck is also working on its own proposal to split the company, which shareholders are expected to vote on next week. But to do that, it needs sufficient investor support.
That’s what Friedland and others could come in.
7/ It is short-sighted to sell to Glencore without exploring Teck's valuable opportunities across the industry. Join me in revisiting Dr. Norman Keevil's book Never Rest on Your Ores - Building a Mining Company, One Stone at a Time ... one of the great stories of Canadian mining.— Robert Friedland (@robert_ivanhoe) April 17, 2023