Windfall for shareholders as Anglo American merges with Teck Resources

Shareholders will receive a R73-per-share special dividend on top of other benefits

- TAWANDA KAROMBO

SOUTH African shareholders in Anglo American will receive a R73 per share special dividend in addition to other economic benefits after the global miner agreed to a tie-up creating a merged entity with Teck Resources more than a year after turning down an offer from BHP.

Teck Resources is a Canadian mining company. Its merger with Anglo American will be under a merger of equals is expected to yield $800 million in pretax recurring annual synergies.

South African shareholders in Anglo American stand to get a windfall from the transaction, said analysts. Anglo American has been re-strategising after it rebuffed a buyout offer from BHP.

"South African shareholders will receive the economic benefits of the merger without paying a premium merger of equals. Shareholders will also receive a $4.5 billion special dividend which works out to be around R73 per share," Robbie Proctor, resource analyst at Anchor Capital told Business Report on Tuesday.

Shares in Anglo American surged by 9.2% to R590.35 on the JSE on Tuesday, a reversal of the company's 3.49% slump in the past six months. Kumba Iron Ore, controlled by Anglo American, also rose 1.69% to R316.55 on the same exchange in afternoon trade.