BHP requests extension of Anglo American offer deadline

BHP requests extension of Anglo American offer deadline
BHP requests extension of Anglo American offer deadline

(Alliance News) – BHP Group Ltd has requested an extension to the Wednesday deadline for its takeover bid for mining company Anglo American PLC.

Last week, the Melbourne-based miner’s third £34 billion takeover proposal was rejected by London-headquartered Anglo American.

BHP offered 0.8860 BHP shares for each Anglo share.

BHP shares were trading 1.0% higher at 2,358.33 pence per unit in London on Wednesday morning, while Anglo American was down 0.8% at 2,537.50 pence per unit . BHP’s market capitalization is £119.31 billion, while Anglo American’s is £33.93 billion.

Anglo American rejected the offer, saying it had the same “very complex structure” as previously rejected offers on April 26 and May 13, as well as a risk to shareholder value.

BHP’s global offer also required Anglo American to divest from its South African operations and complete two spin-offs of its stakes in Anglo American Platinum Ltd and Kumba Iron Ore Ltd.

“The requirement to carry out two simultaneous spin-offs of publicly traded companies alongside a takeover bid and the interconditional nature of the three transactions are unprecedented and, following a takeover bid, it would be necessary to obtain approvals and additional material conditions, particularly in South Africa,” Anglo American said.

The deadline for BHP to address its concerns and submit a revised offer was later extended to May 29.

However, BHP believes a further extension is now necessary to allow for further engagement on its proposal.

Over the past week, BHP has sought to address the concerns expressed and proposed a series of socio-economic measures to address issues of uncertainty surrounding the proposed transition structure.

The company also indicated it was willing to discuss a reverse breakup fee, payable by BHP, in the event it fails to obtain regulatory and antitrust approvals.

BHP’s offer still provides for the distribution of Anglo American’s stakes in both companies to shareholders, but BHP has outlined a plan to maintain Anglo American’s employment levels in South Africa and provide funds for supporting training and charitable commitments for a period of three years.

BHP intends to maintain its listing on the Johannesburg Stock Exchange with a weighting of approximately 5%.

The current deadline calls for a firm offer from BHP for Anglo to be made by 5pm on Wednesday.

Earlier this month, to counter BHP’s approach, Anglo unveiled a “radical” new strategy that will allow it to retain its copper and iron ore assets, while divesting itself of its copper and iron ore operations. platinum and diamonds.

By Elijah Dale, Alliance News reporter

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