Glencore bid for Teck faces stiff Canuck rules, pride as mining M&A activity triples – by Colin McClelland (Northern Miner – May 11, 2023)

Glencore (LSE: GLEN) faces an uphill battle to buy Teck Resources (TSX: TECK.A/TECK.B; NYSE: TECK) because of Canadian nationalism despite surging mergers and acquisitions in the critical minerals space.

The mining industry’s M&A activity is up 283% to US$66 billion so far this year compared with the same period last year while dealmaking across all industries is down 38% to US$1.2 trillion, according to Bloomberg data presented on Wednesday at the Society for Mining, Metallurgy & Exploration’s eighth annual Trends in Mining Finance Conference in New York.

The sector is led by Glencore’s US$27.1-billion bid last month for Teck and Newmont’s (NYSE: NEM, TSX: NGT) US$20.1 billion offer in February for Newcrest Mining (TSX: NCM; ASX: NCM). The values, reflecting updated Bloomberg data compared with previously reported amounts, help nearly quadruple the value of M&A activity among miners year-to-date versus the same period in 2022 as companies seek gold near record prices and battery metals for the green energy transition. Action in the diversified mining sub-sector that includes Teck is up 700%.

However, London-based Glencore’s proposed acquisition — rejected so far by Teck — faces tough scrutiny in Canada. The country would suffer a ding to national pride by losing one of its last large international mining companies.

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