Glencore, a diversified major company, has made an offer to acquire Canadian miner Teck Resources' steelmaking coal business, Elkview Resources (EVR). Teck has previously rejected Glencore's merger proposal twice. Glencore still intends to split into MetalsCo and Coalco, but the demerger would not happen immediately.

Glencore stated that while it remains interested in pursuing the full merger with Teck, the alternative proposal for EVR would allow for a value-enhancing demerger of the combined coal and carbon steel materials business (CoalCo) to its shareholders. If the transaction goes ahead, Glencore plans to demerge CoalCo once it has sufficiently reduced its debt, which is expected to take about 12 to 24 months from the closing of the deal.

The value of the proposed EVR transaction has not been disclosed by Glencore and Teck. Analysts estimate it to be close to Teck's fairness opinion of C$10 billion to C$12 billion ($7.5 billion to $9 billion) and Glencore's prior cash/stock proposal of $8.2 billion.

Teck's board initially opposed Glencore's merger proposal and instead wanted to separate its coal and metals assets. However, they withdrew that plan shortly before a shareholder meeting in late April. Teck has confirmed receiving a "high degree of interest" in its EVR business from various parties, with Glencore's cash proposal being one of them.

Both Glencore and Teck are working towards ensuring that the proposed acquisition of EVR benefits Canada, and they are open to identifying commitments for the benefit of all stakeholders. The Canadian government, led by Prime Minister Justin Trudeau, has emphasized the need for a rigorous approval process for any takeover bid for Teck due to the company's significance to the Canadian economy.