Bloomberg News | May 29, 2024 |
Image courtesy of Glencore.
Glencore (LON: GLEN) will start consulting with shareholders on the future of its coal business as soon as its deal to buy Teck Resources Ltd.’s mines closes later this year.
Crucially, Glencore said that should the majority of shareholders support keeping its coal mines, the company will not proceed with a vote.
Glencore’s coal business is one of its most profitable units, driving record returns in recent years, and the plan to exit the fossil fuel and list a new company in New York represented a major strategic pivot under current boss Gary Nagle. The company had long resisted pressure to follow rivals in jettisoning coal, arguing that the world still needed the dirtiest fuel and that it was more responsible to run the mines itself than sell them.
Bloomberg reported last month that several of Glencore’s largest shareholders believe the company should retain its coal assets.
The deal to buy Teck’s coal mines is expected to close in the third quarter.
Once the acquisition closes, Glencore will immediately consult with investors, Chief Executive Officer Nagle said at the company’s annual shareholder meeting on Wednesday. That will dictate the firm’s next move on coal, he said.
Nagle said that if the majority of shareholders want to keep coal, there will be no vote. Should the consultation show support, there will be a binding vote.
That approach would potentially allow Glencore to avoid some of its shareholders having to vote against a company proposal should they want to keep coal.
The company’s largest shareholders are former CEO Ivan Glasenberg, the Qatar Investment Authority and BlackRock Inc.
Glencore, the world’s largest shipper of thermal coal with a market capitalization of about $75 billion, had said it intended to spin the business off within two years of closing a deal to buy the steelmaking coal assets of Teck.
(By Thomas Biesheuvel)
No comments:
Post a Comment