Glencore deal to purchase all of PolyMet moves forward

July 17, 2023

PolyMet Mining Corp. accepted Glencore Plc's proposal to buy the remaining 18 percent stake in the company for about $73 million.

The acquisition is subject to shareholder approval at a meeting set for the end of the third quarter or early in the final quarter of the year, PolyMet added.

PolyMet is developing a copper-nickel mine in northeastern Minnesota with Canada's Teck Resources another company which is on Glencore's radar.

Since 2005, the mining company PolyMet — which is based in St. Paul and registered in Canada — has been trying to open a copper mine a few miles away that would send ore here for processing and waste disposal. But the project recently lost a key permit and now, 18 years on, has no official opening date, the Minneapolis StarTribune reported.

The saga of PolyMet and two other hardrock mines proposed in Minnesota highlights a dilemma playing out globally. Demand for copper and nickel is surging thanks to a worldwide transition to clean electricity and electric vehicles, which is driven by government policy and improving economics. But the mineral supply is not keeping up, with opposition to proposed mines like PolyMet.

Glencore, a Switzerland-based global mining giant, began financing PolyMet in 2008 with $25 million in debt that was convertible into equity. Over the years, it has continued to use that same financing mechanism, and by 2019 it had amassed a 29 percent stake.

Al Hodnik, lead independent director and chair of the Independent Special Committee, said of the transaction, “The necessary next step for advancement of the NewRange Copper Nickel joint venture and the development of strategic minerals vital to our economy’s clean energy transformation. The Special Committee strived to maximize value for our minority shareholders in light of the uncertain permitting environment and associated judicial outcomes as well as the likely need for further substantial financing to meet the company’s obligations to NewRange. The transaction provides the company’s minority shareholders with an opportunity to realize an attractive cash premium for their shares with limited closing risk. As such, the transaction is unanimously recommended by the independent special committee of the company and the board (excluding conflicted directors).”



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