The merger and acquisition incentive plan was boycotted by shareholders, and British and American Resources urgently withdrew to pass the TECK.US acquisition case

Zhitong Finance App learned that the day before shareholders voted on the acquisition of TECK.US (TECK.US), Anglo-American Resources Group announced the cancellation of an executive incentive plan resolution.

Last month, the Anglo-American Resources and Remuneration Committee proposed that long-term incentive bonuses for 2024 and 2025 should be linked to the Tektronix acquisition. The original assessment metrics of the incentive plan covered return to shareholders, cash flow, return on capital, and environmental, social, and governance (ESG) performance. According to the original plan, at least 62.5% of the incentive share will take effect immediately after the acquisition is completed.

Anglo-American Resources said on Monday that in view of objections raised by some shareholders, the company has decided to withdraw the resolution and stressed that the progress of the acquisition transaction is not a prerequisite for approval of the resolution.

The shareholders of Anglo-American Resources and Tektronix Resources will vote on the merger deal at special shareholders' meetings to be held in London and Vancouver respectively on Tuesday. After the transaction is completed, a multinational metal producer with a market capitalization of more than 50 billion US dollars will be created. The business covers copper, iron ore and various other metal categories.

Notably, although Institutional Shareholder Services Inc. recommended investors vote for the acquisition last month, it clearly stated that it did not agree with the British and American Resources adjustment plan that binds long-term incentive plans to the success or failure of the transaction.

The shareholder advisory agency stated, “In the UK market, the practice of directly linking remuneration to mergers and acquisitions is not considered a compliant market practice.”

Legal & General is also opposed to this incentive adjustment, saying that such a “retroactive adjustment mechanism and transaction bonus guarantee clause” violates the financial services group's remuneration policy principles. However, the agency also stated that it would still vote in favor of the takeover deal.

After the merger, the new company will be headquartered in Canada, while retaining the main listing position of Anglo-American Resources in London. The core business will focus on copper assets in Chile and Peru.