Thursday, June 13

JSW Steel’s Ambitious Bid for Teck Resources’ Steelmaking Coal Business

JSW Steel Pursues Teck Resources’ Coal Venture: JSW Steel aims for a 75% stake in Teck Resources’ Elk Valley Resources, potentially valuing the coal business at $8 billion, challenging Glencore’s bid.

JSW Steel considers 75% interest in Teck's coal business
JSW Steel considers a 75% interest in Teck’s coal business

In an unexpected twist, Indian conglomerate JSW Steel Ltd (JSTL.NS) is reportedly eyeing a substantial 75% stake in Teck Resources’ (TECKb.TO) coal business, Elk Valley Resources. While earlier speculations pointed towards a potential 20% acquisition, this heightened interest could propel the valuation of the venture to an impressive $8 billion, as indicated by sources at Bloomberg.

This move sets the stage for a high-stakes clash, as it squares off against a prior bid by Swiss heavyweight Glencore (GLEN.L) for the same venture. Glencore had initially aimed for a takeover of Teck’s coal business as a standalone unit, albeit after the Canadian mining firm had twice rejected its offer of a $22.5 billion merger.

The stakes have been further raised by Teck CEO Jonathan Price’s announcement in July, indicating the exploration of several proposals from various potential investors, including the possibility of a partial sale of its coveted coal business.

The situation gains an air of intrigue as JSW Steel remains tight-lipped, declining to comment on the matter, while Teck Resources is yet to respond to Reuters’ inquiry for an official statement. With the industry on the edge of its seat, this unfolding narrative promises to reshape the landscape of steelmaking and resource dynamics on a global scale.

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