TCL #54: The Merger of Incompatible Elements

Last week, Canada greenlit the Anglo American - Teck Resources merger, cementing Vancouver as the headquarters of the new copper powerhouse. Meanwhile, a media company is merging with a nuclear fusion company. The plan? Build utility-scale power plants, starting with a 50 MW facility. But can a media company truly revolutionise nuclear energy? And what does this mean for both industries?

Mining

Canada's government has approved the merger between Anglo American and Teck Resources. The deal received broad support from shareholders in recent votes. The combined market value of the companies has reached approximately $60 billion. This approval was crucial, with concerns raised about the economic benefit to Canada. The deal will involve C$4.5 billion (~ $3.3 billion) in spending in Canada over 5 years. A condition for approval was that the combined entity, Anglo Teck, would have its global headquarters in Vancouver, Canada.

The merger has come as global copper prices have reached record highs of almost $12,000 per tonne this month, with miners seeking to increase production. The newly combined group is projected to become the fifth-largest producer of mined copper. The Anglo purchase of Teck still requires approval from regulators in Europe, Japan, South Korea, the United States, Chile, and China due to antitrust concerns.

Nuclear Tech

Trump Media & Technology Group (TMTG), known for operating Truth Social, has announced a merger agreement with TAE Technologies, a company focused on fusion power. The deal is valued at $6 billion and is an all-stock transaction. The combined entity plans to construct a utility-scale fusion power plant, starting with a 50 MW facility and expanding to 500 MW. TAE technologies has previously raised around $1.3 billion over 11 rounds from investors including Google and Chevron. Shareholders of both TMTG and TAE will own 50% of the new combined entity.

Radiant Nuclear, a California-based clean energy startup, has secured over $300 million in a new funding round led by Draper Associates and Boost VC, valuing the startup at over $1.8 billion. The company is developing a 1 MW microreactor designed to be transportable by semi-truck, offering a compact nuclear power solution. The microreactor utilises helium cooling and TRISO fuel, designed for enhanced safety and a five-year operational period between refuelling. The primary target market for Radiant's reactors includes commercial and military sites, aiming to replace traditional diesel generators. Data centres are identified as a key customer segment, with Radiant already having a deal with Equinix to supply 20 reactors. The testing of the microreactor is anticipated to begin in the summer of 2026.

Last Energy, another nuclear startup, has raised $100 million in Series C funding, led by the Astera Institute. The startup is developing small modular reactors (SMRs) with an output of 20 MWe each and is projected to enter production in 2028. Last Energy is leveraging an older, US government-developed design for a pressurised water reactor, originally intended for the NS Savannah, the world's first nuclear-powered merchant ship, launched in 1959 as part of President Eisenhower's Atoms for Peace program. A key innovation in the design is encasing each of its microreactor cores in approximately 1,000 tons of steel, eliminating the need for separate waste disposal as the steel chamber doubles as a waste cask. These steel-encased reactors will be delivered pre-fueled with six years of uranium, with external pipes harvesting heat for steam turbines.

Critical Minerals

The US is supporting a $7.4 billion investment in a critical minerals processing plant to be built by Korea Zinc, a Seoul-based non-ferrous metal smelting company. The plant, to be built in Tennessee, will produce antimony, germanium, and gallium, essential for semiconductors and electronics, along with zinc, lead, copper, gold and silver. Commercial operations are expected to begin gradually between 2027 and 2029.