Reuters reported that Teck Resources hopes to regain its investment grade debt rating as early as the end of this year, allowing it to focus on growth rather than on healing its balance sheet.
Mr Don Lindsay CEO of Teck Resources said that higher cash flows in the second half of the year mean Teck is nearing its targets of debt to debt plus equity of 25% to 30% and a debt to earnings of ratio of 2.5.
Teck's debt was downgraded to junk status following last year's purchase of Fording Canadian Coal Trust, as rating agencies fretted it would be unable to pay back debt taken on to finance the deal. Teck borrowed USD 9.8 billion to buy Fording, including a USD 5.8 billion one year bridge loan.
Teck has since sold some assets, issued long term bonds, and sold a 17% stake to China Investment Corp to pay down the bridge loan and some of the remaining term debt.
