Swiss commodity trading and mining company Glencore has revised its $22.5bn proposal to acquire Canadian mining company Teck Resources, adding an $8.2bn cash element to its offer.

The announcement follows Teck reinforcing its proposal to split the business into two separate entities, saying it is the only optimal option to maximise its shareholder value.

Also, the company raised a concern that Glencore’s proposal would expose its shareholders to significant jurisdictional, ESG and execution risk, and called the proposal a ‘non-starter’.

Glencore revised its proposal to include an $8.2bn cash element to its merger demerger to buy Teck shareholders out of their stake in a coal-focused spin-off.

Teck shareholders would receive a 24% stake in MetalsCo, a separate industrial metals business that would be created off the back of the deal, along with the cash element.

Glencore said that CoalCo’s combined thermal and coking coal assets would be highly cash-generative and would attract strong investor demand given its yield potential.

However, certain Teck investors may wish to completely exit from the coal business, while others may not wish to be exposed to the thermal coal business.

Teck confirmed the receipt of the revised offer from Glencore, stating that the offer appears to be largely unchanged, except for a cash consideration alternative.

The revised proposal does not provide any increased overall value to its shareholders or address material risks previously it has raised, said Teck.

Glencore said that the revised valuation is in line with the implied enterprise value of Elk Valley Resources (EVR) and Teck’s transitional capital structure as per its proposed separation into Teck Metals and EVR.

In addition, the valuation is consistent with the valuation ranges of EVR provided by Origin Merchant Partners, in its fairness opinion to the Special Committee of the Teck Board.

Glencore said that it is prepared to offer a combination of cash and CoalCo shares that equals up to 24% if all Teck shareholders prefer to have shares over cash.

Glencore, in its statement, said: “If a transaction were to materialise, Glencore would manage its balance sheet through to closing such that MetalsCo would continually consider the above cash element as part of its previously highlighted about $8bn pro-forma net debt cap.

“Glencore continues to believe that the respective Glencore and Teck businesses are uniquely complementary and that the creation of MetalsCo and CoalCo through the Proposed Merger Demerger is a compelling opportunity to create material value for the companies’ shareholders.”