Teck Resources’ largest shareholder has cashed out of more than 40 per cent of its position in the firm, selling 42 million shares of the company -- and sending the miner’s stock lower in the process. China Investment Corporation, which bought into the diversified commodity player in 2009, will continue to hold 10.4 per cent of the firm.

In a press release announcing the news Tuesday, Teck Chief Executive Officer Don Lindsay praised the sovereign wealth fund’s aid in helping the company make inroads into China, the largest consumer of base metals on the planet.

“Prior to their purchase of our shares in July 2009, CIC told us they intended to be a long-term partner focused on financial returns. They have fully lived up to that commitment and, in addition, have been helpful in building important relationships with customers and others in China,” he said.

“We understand CIC's reasons for monetizing a portion of its shareholding and are pleased that CIC intends to remain a significant financial investor in Teck.” 

At 12:35 p.m. ET, Teck shares were trading down seven per cent at $29.23.

CIC began poking around Teck in early 2009, when the share price was languishing south of $4 amid concerns it could ultimately default on its debt, much of it accrued to finance its US$14.1-billion deal for Fording Coal in 2008.

The stock recovered in the interim between initial talks and CIC’s final $1.74-billion investment in July 2009 after Teck issued $4 billion of bonds and sold a number of smaller assets to shore up its balance sheet. The investment in Teck was the first CIC had made on Canadian soil, and was lauded by Lindsay for its “immediate and positive” effect on the company.

One of the key factors that attracted Teck to the deal with CIC was the fund’s willingness to invest in spite of the company’s dual-class share structure. Under the terms of the deal, CIC’s 6.7 per cent voting rights paled in comparison to its 17.2 per cent ownership stake.  

That deal was shepherded by veteran Toronto investment banker Felix Chee, who brought Teck to CIC management’s attention in his role at the time as special advisor to the head of investments at the fund. Chee’s previous work experience included time as Manulife’s Chief Investment Officer and a senior posting at the Ontario Hydro Pension Plan. Chee’s work ultimately led to the wealth fund opening an outpost in Toronto, though it shuttered the office in 2015 amid persistent weakness in metals prices. Chee left the CIC in 2013.