Glencore (LON: GLEN) scrapped on Wednesday plans to separate its coal division, which it had announced following its acquisition of assets from Teck Resources last year (TSX: TECK.A, TECK.B)(NYSE: TECK), as shareholders opposed the move.
The Swiss miner and commodities trader said in November it would merge Teck’s steelmaking coal business with its own coal assets, after which it would demerge the combined unit.
Shareholders representing nearly two-thirds of eligible voting shares were consulted, Glencore said. Over 95% of those who expressed a preference supported retaining the coal and carbon steel materials business, primarily because they believe it would enhance the firm’s cash generating capacity.
Glencore’s backpedaling on its coal exit did not come as a surprise to analysts, as investors had been pushing for the company to keep mining the fossil fuel for longer.
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