Photo: Nelson Bennett
Conservative Party Leader Pierre Poilievre said ‘actions like Glencore’s are unacceptable.’
Pierre Poilievre and his Conservative Party are in no position to do anything about Glencore’s bid for Teck Resources (TSX:TECK.B,NYSE:TECK), but if the Conservatives were in power, they would use the Investment Act to prevent what Poilievre calls a hostile takeover.
“A Poilievre government would bring home Canadian jobs by using the Investment Canada Act to stop this hostile foreign takeover, and take into account Glencore’s previous unethical behavior,” Poilievre said Thursday – a day after Teck canceled a vote on a plan to divide the company in two.
“A serious, Conservative government that is focused on creating jobs, protecting our supply chain, and supporting environmentally responsible companies, will make it clear that actions like Glencore’s are unacceptable.”
“Thousands of Canadian jobs depend upon Teck Resources’ survival as a Canadian-owned and operated business,” said Rick Perkins, shadow minister for Innovation, Science and Industry, said in a press release.
“Conservatives will keep strong Canadian mining jobs in Canada, rather than allowing an ethically compromised company from shipping these jobs overseas.”
Teck’s now-scrapped plan to divide Teck into two companies – one metals-focused, the other owning BC’s steelmaking coal mines — led Glencore to pitch a US$23 billion merger and demerger plan, which Teck’s board of directors have rejected.
But Glencore is persisting, and now warns that if the board of directors won’t at least entertain an updated offer to combine the companies, it will go directly to shareholders with an offer.
This opens the door to a Canadian mining giant being acquired by a bigger Swiss mining giant. It is feared that Vancouver could lose another major head office, as a result.
The bid has also stirred Canadian nationalist sentiment, with politicians and mining moguls like Ross Beaty and Robert Friedland coming out against Glencore, and arguing that Teck should remain a Canadian company.
In addition to steelmaking coal mines, Teck owns copper mines in BC and Chile and a zinc mine in Alaska. Both copper and zinc are on Canada’s new critical minerals list.
Maintaining Canadian control of these kinds of metals is now considered to be of national interest, since critical minerals are an essential part of the supply chain for making electric vehicle batteries and other clean energy technologies needed for the energy transition.
The Trudeau government has already used the national interest argument to order the divestment of Chinese investors in three Canadian lithium exploration companies – lithium being a critical battery mineral — so it’s possible the Trudeau government could end up doing what Poilievre says he would do.
Those opposing a potential takeover of a Canadian mining company by Glencore have pointed to Glencore’s dubious record as a reason to reject it. Last year, the company pleaded guilty to bribery and market manipulation, and ended up paying more than US$1 billion in fines.
The Conservatives also noted that, in 2018, the Ontario Securities Commission fined a Glencore Canadian subsidiary of more than $20 million for misleading investors.
“Similarly, Glencore performs virtually no mineral exploration, creating a dead-end for Canada’s resource sector,” the Conservatives said in a news release. “A Poilievre government will ensure that foreign companies who engage in despicable forms of corruption will not be given control of one of Canada’s most important industries.”