Anglo American and Teck Resources have announced a merger of equals which will result in the formation of the Anglo Teck group. This gives the entity a combined value of ~US$50Bn based on current market capitalisations as they plan to enter an era of dominance in the critical minerals space.

Anglo shareholders will own 62.4% with Teck shareholders receiving the remaining share, creating the potential for a new top five copper miner. The deal allows the companies to diversify their commodity base, alongside unlocking operational synergies in their copper portfolios, particularly in Chile and Peru.

Anglo’s portfolio of PGMs, nickel (albeit pending sale completion with MMG) and iron ore will be complemented by Teck’s production of zinc, molybdenum, indium, and germanium. Diversifying their commodity base allows for a more comprehensive suite of products for downstream alloying customers.

Anglo Teck plans to commit an investment of C$4.5Bn (US$3.26Bn) over five years in its Canadian operations. Notably, as part of the investment, Anglo Teck highlighted its continued investment in its Trail Operations metallurgical facility of up to C$750M (US$543M) with the potential to expand production capacity for germanium and other strategic minerals.

This move comes at a time when US germanium spot prices reached a 25-year high of US$4,005/kg, a 78% y-o-y increase, in the wake of Chinese export restrictions.

Both companies seem to have similar forward-facing outlooks, having ‘strategically’ divested away from coal with Anglo also removing its platinum exposure and plans to divest its Diamond business. Each has previously rebuffed takeover approaches (Anglo from BHP in 2024 and Teck from Glencore in 2023). The agreement between Anglo and Teck could be seen as a move to steady the ship and strengthen their position during a time of transition.

The combined group is targeting roughly US$800M in annual synergies from the partnership. The key area of overlap will be in South American copper, with Anglo Teck expected to offer more than 70% copper exposure, leveraging Anglo’s Collahuasi and Teck’s Quebrada Blanca assets, situated in close proximity within northern Chile.

This geographic alignment creates scope for efficiencies across operations, infrastructure, and logistics, particularly in shipping.

Additionally, Teck adds a significant pipeline of copper development projects, where Anglo’s experience at Quellaveco and Collahuasi could accelerate progress and support expansions at Quebrada Blanca.

Anglo Teck would be headquartered in Vancouver, BC, Canada, while maintaining its primary listing on the London Stock Exchange (with secondary listings on the TSX, JSE, and NYSE).