What you need to know about Teck Resources, its plans to split and talk of a foreign takeover

For months TeckResources Ltd., one of B.C.'s biggest mining companies, hadbeen preparing a proposal to split into separate businesses, one dedicated to metals, the other to steel-making coal.

But early Wednesday,Teck said itwould not go ahead with a shareholder vote on the plan, just hours before it was due to take place at an annual meeting.

"Our plan going forward is to pursue a simpler and more direct separation, which is the best path to unlock the full value of Teck for our shareholders," chief executive Jonathan Price said.

Wednesday's vote had been planned amid a hostile takeover bid from Swiss conglomerate Glencore, with politicians voicing concern over the long-term future of projects in B.C. should it go ahead.Teck employs upwards of 10,000 people, many of whom work in mines and smelting operations near the B.C.-Alberta border.

The plan to split the company was itself controversial in light of Teck'slong history of environmental violations for polluting waterways with selenium, with environmentalists worried the spinoff is a way for the company to duck responsibility.

Here's what you need to know about Teck Resources and its path to a potential split and what happens next in the wake of the cancelled vote.

Whysplit thecompany in two?

Teck wantedto spin off its metallurgical coal businesses and metal mining businesses into two separate companies, Elk Valley Resources (EVR) and Teck Metals.

According to Teck, this would focus the company's operationsand also provide investors with a choice amid a volatile investment landscape.

"Both Teck Metals and EVR have high-quality operating assets and strong financial foundations," said Price in a statement in Februaryannouncing the mooted separation.

Dunbar says the idea of the larger Teck Metals focusing on copper and zinc is appropriate as those metals are in demand for use in renewable energy projects.

B.C. and Canada have a critical minerals strategy that hinges on the production of metals like copper and zinc.

Under the spinoff plan, the companies could eventually fully separate financially, though Elk Valley would pay Teck Metals a royalty until then.

Dr. Scott Dunbar, head of the University of British Columbia's mining department,said if a spinoff happens, it likely wouldn't immediately affect people working in the mines in B.C.

Why is Tecka takeover target?

Dunbar said Teck is a mid-sized mining company in a pool full of large conglomerates like Glencore, Rio Tinto and BHP, which makes them a target for acquisition.

"They've got lots of very good operating mines," he said. "An operating mine is a huge asset and that's what Glencore is attracted to."

Wyatt Petryshen, a mining policy researcher at advocacy group Wildsight,saysthe prospect of Glencore taking over Teck would not bode well, given the company's history of unethical mining practices and its thermal coal operations, which the Government of Canada wants phased out due to environmental impacts.

"Teck also has major issues when we're talking about environmental stuff, as well as their relationships with some First Nations," he said.

"But hypothetically, I would say they'd be slightly more socially responsible in British Columbia than a company like Glencore."

What are the environmental concerns?

Much of Teck's current operations are based on metallurgical coal, which is used insteel making.

Metallurgical coal-making creates byproducts, one of which is selenium. The company has been fined numerous times for selenium pollution in rivers that flow across the Canada-U.S. border.

The local Ktunaxa First Nation has asked for an international probe from a joint commission regarding the pollution, something the U.S. government has said it would support.

Petryshen says the company hasn't done enough to fulfilits commitments when it comes to pollution mitigation.

"There's still about $430 million that Teck hasn't actually put aside to pay for environmental damages in the case of a disaster or something like that," he said.

Petryshen says regulators should take note to incorporate the wishes of First Nations when it comes to watershed management as more companies begin to focus on the sector.

He added that, in the event of a spinoff or a takeover, Teck should provide assurances they would not leave taxpayers with an expensive cleanup bill like in the case of Alberta's "orphaned" oil and gas wells.

Dunbar said the company wouldn't be able to get rid of their environmental problems.

"They've got a binding agreement to work with that. It's with the provincial government," he said. "That stays with either Elk Valley or Teck they'll handle that because it's a big problem."

Teck Resources was also the face of one of the largest oilsands mining projects in recent memory, Teck Frontier, which was eventually shelved in part due to environmental concerns.

What happens now?

On Wednesday, Teck held a virtual conference to share its first-quarter results and provide more information about the cancelled vote.

Price told those listening in, which included shareholders and industry analysts, that in the months leading up to the proposed vote, there hadbeen substantial interest in both sides of Teck's operations.

He said finding a different way to split up the company was now required, "to unlock the full value of Teck for our shareholders."

He did not provide any timelines for when a new option would be realized or what thenew ideas were.

"We will look very broadly at the full suite of options," he said. "We will continue to work with our shareholders to get their perspective and understand their feedback."

Despite saying several times that the majority of shareholders were supportive of the original separation plan, when asked, he said the company was not on track to get the two-thirds majority needed to push through the change.

"Tracking showed we weren't going to achieve the 66 and two third per cent that we needed for approval in this instance."

Dunbar saidwith no vote,it's likely Glencore would up their bid for Teck.

He also said any potential new companies like the proposedTeck Metals and Elk Valley Resourcescould be acquisition targets in the future.

B.C. Premier David Eby has said he has concerns over any acquisition, and that any potential acquiring company might have different corporate priorities and might not want to keep Teck's B.C. projects on its books.

The province says it has been in talks with the federal government and Teck themselves over the potential takeover.