Teck Resources Ltd ( TECK ) shares are trading higher Tuesday after the company announced a merger of equals with Anglo American.

What To Know: Teck and Anglo American will combine to form Anglo Teck, a global critical minerals company and one of the world's top five copper producers. The merged group will be headquartered in Canada and is expected to provide investors with more than 70% copper exposure.

The merger is expected to deliver approximately $800 million in pre-tax recurring annual synergies by the fourth year following completion. Additional revenue synergies of about $1.4 billion annually are expected from 2030 to 2049 through integration of the Collahuasi and Quebrada Blanca operations.

Anglo Teck will also maintain a strong portfolio in premium iron ore and zinc, alongside significant copper growth projects in established mining jurisdictions.

Under the agreement, Anglo American shareholders will own about 62.4% of Anglo Teck and Teck shareholders will hold roughly 37.6%. Anglo American shareholders will also receive a $4.5 billion special dividend ahead of the transaction's completion.

The boards of both companies have unanimously approved the merger, which remains subject to customary closing and regulatory conditions. Completion is expected within 12 to 18 months.

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TECK Price Action: At the time of publication, Teck shares are trading 14.35% higher at $40.18, according to data from Benzinga Pro.

This illustration was generated using artificial intelligence via Midjourney.