Teck Resources Ltd.’s decision to split the business into two independent companies will help enhance their strategic and financial focus, according to the company’s chief executive officer.
In an interview with BNN Bloomberg on Tuesday, Jonathan Price, CEO of Teck, said this decision is about giving investors a “choice to allocate their investment between two businesses, which now have different underlying commodity fundamentals and value propositions.”
“This separation ultimately will enhance the strategic and financial focus of both of these companies, and their respective ability to pursue independent growth and capital allocation strategies,” Price said.
In a press release on Tuesday, Teck announced it would spin off its steelmaking coal business into Elk Valley Resources Ltd. (EVR).
The release stated “EVR will be a high-margin Canadian steelmaking coal producer, focused on long-term cash generation and providing cash returns to shareholders, with significant equity value accretion potential.”
The second half of the business will become Teck Metals Corp., which will be “growth-oriented, with premier, low-cost base metals production, a top-tier copper development portfolio and a disciplined capital returns policy.”
“[We’re] unlocking the value of two strong, sustainable mining companies, both committed to responsibly producing the resources the world needs,” Price said.
Check out the video at the top of the article for the full interview.
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