Anglo American will not redomicile to Canada as it seeks approval from the federal government for its acquisition of Teck, CEO Duncan Wanblad says.Jennifer Roberts/The Globe and Mail
The head of Anglo American PLC NGLOY says the British mining company isn’t willing to redomicile to Canada, as Ottawa asks for more concessions around its proposed acquisition of Teck Resources Ltd. TECK-B-T
London-based Anglo has already made a slew of promises as it attempts to win approval from Ottawa for the US$20-billion deal which was announced last week. Those commitments include moving its global headquarters to Canada and changing its name to Anglo Teck. The company also promised to relocate many of its high-ranking personnel to Canada, including chief executive officer Duncan Wanblad, and chief financial officer John Heasley.
However, Industry Minister Industry Minister Mélanie Joly earlier in the week told The Globe and Mail that promises made by Anglo don’t go far enough. The deal can’t proceed unless Ms. Joly deems it to be of net economic benefit to Canada, and determines that there are no national security concerns.
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In an interview with The Globe on Thursday, Mr. Wanblad would not reveal more concessions the company may make to Ottawa, saying “there is no way I am going to negotiate this in public,” but he made it clear that certain options are off the table.
Redomiciling the company to Canada isn’t in the cards, and neither is moving the primary stock listing from The London Stock Exchange to the Toronto Stock Exchange.
Mr. Wanblad cited London’s deep and liquid mining market, an investment community that understands mining, and the fact that many of its shareholders are based there.
“We have looked and continue to look at where the best places to list mining companies are right now, London is very good for what it is that we’re trying to do here,” he said.
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A contingent of the Canadian investment and mining community is pushing back on the deal, because Canada stands to lose yet another mining and metals champion to follow Alcan Inc., Falconbridge Ltd., and Inco Ltd., which all have been sold to foreign mining companies.
Pierre Lassonde, co-founder of Franco-Nevada Corp. told the Globe on the day the deal was announced last week that the sale of Teck is a tragedy for the Canadian mining industry.
Bay street veteran Tom Caldwell, chairman of Caldwell Securities Ltd., told the Globe this week that losing Teck is painful for the already hollowed-out Canadian mining sector and that it’s a “joke” that companies from South America, Australia and South Africa now dominate the Canadian mining sector.
Mr. Wanblad, a South African, said that he understands that some factions of the mining industry have a problem with the deal.
“Canada is a great mining jurisdiction. It has a rich history. I completely get the angst that’s caused by the notion of this hollowing out,” he said referring to past acquisitions of Canadian mining companies.
But he also expressed confidence that by basing its headquarters in Canada, and that by he himself moving here, some of those fears should be alleviated. In addition, through ongoing negotiations with Ottawa, he said it’s likely there will be legally-binding commitments that the company will have to adhere to that will further insulate the Canadian mining industry.
“I have no doubt that we’ll end up having legally binding commitments here with Canada,” Mr. Wanblad said.
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When Glencore PLC acquired Teck’s coal assets in 2024, it was subject to several legally-binding commitments, including keeping a Canadian head office for the coal business for 10 years and guaranteeing a majority of the directors of the business are Canadian, also for a period of 10 years.
The Anglo Teck deal has already attracted the attention of the highest levels of government. The Globe reported earlier this week that Prime Minister Mark Carney told Anglo that moving its headquarters to Vancouver was necessary otherwise he wouldn’t approve the deal.
Teck’s board and one of its controlling shareholders, Norman B. Keevil, has backed the deal but that isn’t enough to ensure success. At least two thirds of votes cast by the company’s B shareholders must also be in favour of the deal. A shareholder vote is expected to be held before the end of the year.