Merger of Anglo American and Canada's Teck Resources approved by shareholders

Anglo American shareholders have approved a 'merger of equals' along with shareholders in Canada's Teck Resources to form the global critical minerals company Anglo-Teck.

The entity will be headquartered in Vancouver and is projected to be in the top five copper producers in the world.

The positive vote by shareholders marks an important milestone in creating Anglo-Teck, said Jonathan Price, President and CEO of Teck Resources.

The new company is expected to offer investors more than 70% exposure to copper.

As Miningmx editor David McKay pointed out in a previous interview, copper is broadly seen as the metal of the future, in view of the trends around electrification and decarbonisation.

He notes that while this deal has taken a next step towards completion, it still has to pass some regulatory hurdles, particularly approval from the Canadian government under its Investment Canada Act.

While Anglo might not have much in the way of assets in South Africa anymore, it is still very very much rooted in the country and Teck occupies a similar place in Canada's corporate history, McKay explains.

As a result, a deal had to be fashioned that ticked some boxes politically, he says.

"Is there ever a merger of equals? No, one company takes over the other and so I think Anglo is the company taking over Tech certainly, but it has to be presented in a conducive way. So, the deputy CEO will be from Tech, the board is 50/50, the company will be headquartered in Canada... and I think that was something Mark Carney (Canadian Prime Minister) personally assisted with."

Why the deal has won a lot of approval so far, is because there is a strong industrial logic for it, McKay says.

"It really has that in its favour and makes it a bit of a standout M&A (mergers and acquisitions) in the mining sector lately."

To hear more from the Miningmx editor, listen to the interview audio at the top of the article