ZURICH: The massive Swiss commodities company Glencore said on Wednesday that, following consultation with shareholders who see the dirty fossil fuel as a means of making money, it has decided not to spin off its coal business for the time being.
After a protracted battle with the Canadian giant over the business, Glencore completed its takeover of Teck Resources’ steelmaking coal subsidiary in July.
The mining and commodities trading conglomerate based in Switzerland had contemplated spinning off Elk Valley Resources, the recently acquired company, and combining it with its own coal operations.
However, Glencore reported that following a shareholder consultation, the majority said they would rather keep the coal and carbon steel materials business.
Glencore CEO Gary Nagle stated over the phone, “I am very confident that this is the right choice.”
The business has maintained that in order to invest in raw materials like copper and cobalt that are necessary for the green transition, it requires the cash flow from its coal mines.
Chairman Kalidas Madhavpeddi stated, “The Board believes retention offers the lowest risk pathway to create value for Glencore shareholders today. This is after extensive consultation with our shareholders, whose views were very clear, and our own analysis.”
In a statement, Madhavpeddi said, “The expected cash generative capacity of the coal and carbon steel materials business significantly enhances the quality of our portfolio.”
