July 29, 2008 5:47 PM

Raw Materials Exchanged in $14 Billion Canadian Mining Deal

Posted by Zach Lowe

Four major firms advised on Teck Cominco's $14 billion acquisition of Calgary-based Fording Canadian Coal Trust, a leading producer of the coking coal that goes into making steel.

Paul, Weiss, Rifkind, Wharton & Garrison served asl lead U.S. counsel for Vancouver-based Teck, the world's largest producer of zinc and metallurgical coal. Also on the deal for Teck: Stikeman Elliott for M&A advice in Canada and Lang Michener on financing.

The deal is the latest acquisition of a company that produces coking coal, the key ingredient for steel mills. Coking coal prices have jumped 50 percent since April as metal companies rush to fill increasing demand in China, India and Russia, the Associated Press reported. Earlier this month, the Am Law Daily reported on Cleveland Cliffs' move to buy Virginia-based coal company Alpha Natural Resources for about $10 billion.

A team from Osler, Hoskins & Harcourt advised Fording Canadian, the firm said.

The $14 billion price tag is a 17 percent premium on Fording's 20-day share average on the Toronto Stock Exchange. Teck will pay $12.4 billion in cash and issue 36.9 million shares for the remainder of Fording.

The Paul Weiss team on the deal included corporate partners Edwin Maynard, Andrew Foley and Jeffrey Marell, and tax partner David Sicular. Bill Braithwaite led the Stikeman team, and Bob Cranston and Hellen Siwanowicz advised on behalf of Lang Michener.

Osler did not immediately provide a list of partners on the deal.

 

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