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Teck Resources Shares Up 14% on Merger Deal With Anglo American
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Key Takeaways
{\"0\":\"TECK rose 14% after announcing a merger with Anglo American to form Anglo Teck.\\r\\n\",\"1\":\"Anglo Teck will have 70% copper exposure with six world-class assets plus iron ore and zinc.\\r\\n\",\"2\":\"The merger includes C$4.5B investment in Canada for mines, processing and job creation.\\r\\n\"}
Shares of Teck Resources Limited (TECK - Free Report) jumped 14% since it announced that it had entered into a merger agreement with Anglo American plc (NGLOY - Free Report) on Monday to form the Anglo Teck group. This merger is expected to create a leader in global critical minerals and be highly attractive to both Teck Resources and Anglo American shareholders.
Teck Resources’ Strategic Merger With Anglo American
Based in Canada, Anglo Teck will have more than 70% exposure to copper and is set to be among the top five global copper producers. The new company will boast an industry-leading portfolio, consisting of six world-class copper assets and premium iron ore and zinc operations.
The combined annual copper production of 1.2 million tons is projected to grow 10% to 1.35 million tons by 2027. Anglo Teck is also set to be a major producer of premium iron ore for cleaner steelmaking. The combined company will be one of the world's largest zinc producers, with operations including the Red Dog mine in Alaska and the Trail Operations in British Columbia.
The deal will create a major boost for Canada's economy by investing approximately C$4.5 billion ($3.25 million) over five years. The Canadian investment includes extending the life of the Highland Valley Copper Mine and boosting critical minerals processing capacity at Trail. Anglo Teck will also move forward with potential major new copper mines in Northwestern British Columbia and invest in critical minerals exploration, innovation, skills training, research and job creation in Canada.
The combined company will have a footprint in South Africa, where it will continue to invest further.
Within four years of completion, the deal is expected to yield around $800 million in annual pre-tax synergies. Around 80% of this is expected to be achieved within two years through economies of scale and operational efficiencies. The merger is also expected to generate an additional $1.4 billion in EBITDA synergies from 2030 to 2049 by optimizing adjacent assets, Collahuasi and Quebrada Blanca, through operational integration.
Details of the TECK-NGLOY Deal
After the closing of the deal, Teck Resources will hold 37.6% of Anglo Teck, while Anglo American will retain 62.4%.
Each Teck Resources Class A and Class B share will be exchanged for 1.3301 Anglo American shares. The deal is subject to regulatory and court approvals. The boards of directors of both Anglo American and Teck Resources have given the nod/go-ahead for the merger.
The deal is expected to close in the next 12 to 18 months.
Teck Resources Stock’s Price Performance
The company’s shares have lost 10.2% in the past year against the industry’s 24.7% growth.
Image Source: Zacks Investment Research
TECK’s Zacks Rank & Stocks to Consider
The company currently sports a Zacks Rank of 3 (Hold).
The consensus estimate for Agnico Eagle Mines’ 2025 earnings is pegged at $6.94 per share. The estimate indicates year-over-year growth of 64.1%. It has an average trailing four-quarter earnings surprise of 10%. Agnico Eagle Mines’ shares have surged 79.1% in a year.
Carpenter Technology has an average trailing four-quarter earnings surprise of 8.4%. The Zacks Consensus Estimate for CRS’ 2025 earnings is pegged at $9.36 per share. Its shares surged 68% in the last year.
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Teck Resources Shares Up 14% on Merger Deal With Anglo American
Key Takeaways
Shares of Teck Resources Limited (TECK - Free Report) jumped 14% since it announced that it had entered into a merger agreement with Anglo American plc (NGLOY - Free Report) on Monday to form the Anglo Teck group. This merger is expected to create a leader in global critical minerals and be highly attractive to both Teck Resources and Anglo American shareholders.
Teck Resources’ Strategic Merger With Anglo American
Based in Canada, Anglo Teck will have more than 70% exposure to copper and is set to be among the top five global copper producers. The new company will boast an industry-leading portfolio, consisting of six world-class copper assets and premium iron ore and zinc operations.
The combined annual copper production of 1.2 million tons is projected to grow 10% to 1.35 million tons by 2027. Anglo Teck is also set to be a major producer of premium iron ore for cleaner steelmaking. The combined company will be one of the world's largest zinc producers, with operations including the Red Dog mine in Alaska and the Trail Operations in British Columbia.
The deal will create a major boost for Canada's economy by investing approximately C$4.5 billion ($3.25 million) over five years. The Canadian investment includes extending the life of the Highland Valley Copper Mine and boosting critical minerals processing capacity at Trail. Anglo Teck will also move forward with potential major new copper mines in Northwestern British Columbia and invest in critical minerals exploration, innovation, skills training, research and job creation in Canada.
The combined company will have a footprint in South Africa, where it will continue to invest further.
Within four years of completion, the deal is expected to yield around $800 million in annual pre-tax synergies. Around 80% of this is expected to be achieved within two years through economies of scale and operational efficiencies. The merger is also expected to generate an additional $1.4 billion in EBITDA synergies from 2030 to 2049 by optimizing adjacent assets, Collahuasi and Quebrada Blanca, through operational integration.
Details of the TECK-NGLOY Deal
After the closing of the deal, Teck Resources will hold 37.6% of Anglo Teck, while Anglo American will retain 62.4%.
Each Teck Resources Class A and Class B share will be exchanged for 1.3301 Anglo American shares. The deal is subject to regulatory and court approvals. The boards of directors of both Anglo American and Teck Resources have given the nod/go-ahead for the merger.
The deal is expected to close in the next 12 to 18 months.
Teck Resources Stock’s Price Performance
The company’s shares have lost 10.2% in the past year against the industry’s 24.7% growth.
TECK’s Zacks Rank & Stocks to Consider
The company currently sports a Zacks Rank of 3 (Hold).
Some better-ranked stocks from the basic materials space are Agnico Eagle Mines (AEM - Free Report) and Carpenter Technology Corporation (CRS - Free Report) . While AEM flaunts a Zacks Rank #1 (Strong Buy) at present, CRS carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The consensus estimate for Agnico Eagle Mines’ 2025 earnings is pegged at $6.94 per share. The estimate indicates year-over-year growth of 64.1%. It has an average trailing four-quarter earnings surprise of 10%. Agnico Eagle Mines’ shares have surged 79.1% in a year.
Carpenter Technology has an average trailing four-quarter earnings surprise of 8.4%. The Zacks Consensus Estimate for CRS’ 2025 earnings is pegged at $9.36 per share. Its shares surged 68% in the last year.