Glencore, a global mining company, has reached an agreement to purchase the outstanding shares of PolyMet Mining, a mine development company. This acquisition will grant Glencore full control of PolyMet Mining, which currently holds a 50% stake in a copper and nickel joint venture with Teck Resources.
PolyMet Mining announced on Monday that under the definitive agreement, Glencore will buy the approximately 18% of issued and outstanding shares it does not already own. The purchase price is set at $2.11 in cash per share, which represents a 2.9% premium compared to PolyMet’s last closing price. Notably, this offer is more than double the trading price in late June when Glencore first made its proposal.
A special committee was formed by PolyMet to evaluate the deal and other available options. The committee unanimously recommended that PolyMet’s board approve the transaction. However, shareholder approval is still pending and will be sought at a meeting scheduled for either the end of the third quarter or the early part of the fourth quarter of this year.
Currently, Glencore already holds an approximately 82% stake in PolyMet, a mining company based in Minnesota.
This move by Glencore comes after it expressed interest in acquiring Teck Resources’ coal assets as an alternative to a full merger. Teck Resources, a Canadian miner, rejected Glencore’s proposal for a complete merger. Teck is now engaging with Glencore regarding its latest offer, which is one of several inquiries Teck has received concerning potential transactions for its coal business.
In premarket trading, PolyMet’s shares saw a 2.4% increase following their decline of 16% this year. On the NYSE American, the shares closed at $2.05 on Friday and have fallen 20% year-to-date on the Toronto Stock Exchange, last closing at C$2.69.