How the Merger Will Create Value
The merger of Teck and Anglo American is a unique opportunity to generate incremental value for all Teck shareholders, both in the near-term and in the long-term. This value comes from four major pathways:
- Opportunity to Participate in Future Value Creation: At closing of the Merger, Teck shareholders will own approximately 37.6% of the combined Anglo Teck on a fully diluted basis. The terms of the Merger allow Teck shareholders to maintain their full investment and participation in future value upside at Anglo Teck, including the proposed QB-Collahuasi synergies and value creation initiatives underway at Anglo American, including near term asset optimization opportunities, proceeds from asset disposals and planned adjacencies between Los Bronces and Andina.
- World-Class Portfolio and Improved Growth Prospects: Anglo Teck will offer a premier portfolio of copper assets, supported by zinc and premium iron ore businesses, including:
- Six world-class copper assets
- One of the world’s largest zinc mines
- Two highly cash generative premium iron ore operations
- Near-term growth driven through asset optimization
- Medium-term growth including through capital efficient adjacencies (including QB & Collahuasi and Los Bronces & Andina synergies)
- Significant long-term brownfield and greenfield optionality
- Compelling Value Creation Through Synergies: The Merger is expected to generate significant value for shareholders by unlocking material operational and functional synergies:
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Approximately US$800 million in pre-tax recurring annual synergies
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Approximately US$1.4 billion of underlying annual EBITDA synergies between the adjacent Collahuasi and QB operations (100% basis)[1]
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- Creation of a Top 5 Global Copper Producer with the Scale, Resilience, Financial Strength and Capital Markets Footprint to Unlock Re-Rating Potential: Anglo Teck will be among the largest global producers of copper with the scale, resilience, financial strength and capital markets footprint, creating the opportunity to re-rate towards a premium copper valuation multiple:
- Combined copper production of 1.2 million tonnes, expected to grow to c.1.35 million tonnes in 2027 from current operations
- Greater than 70% exposure to copper
- World-class portfolio of copper and other cash-flowing assets
- Expanded cash flow base and realization of anticipated synergies expected to result in a stronger financial profile and investment grade credit metrics
- Enhanced capital markets profile and liquidity
[1]On an average annual basis from 2030-2049 but expected to continue beyond this period (100% basis).
