London — Australian mining group BHP said on Monday that Anglo American had rejected a revised buyout offer valuing the company at $42.67bn.
In April, Anglo American rebuffed BHP’s $39bn all-share takeover proposal, saying it was opportunistic and significantly undervalued its prospects.
On Monday, Anglo called the revised offer “highly unattractive” for its shareholders. “The latest proposal continues to contemplate a structure which the board believes is highly unattractive for Anglo American’s shareholders, given the uncertainty and complexity inherent, and significant execution risks,” the London-listed miner said in a statement.
The new offer is 10% higher than BHP’s first one, or a 15% increase in the merger exchange ratio, lifting Anglo American shareholders’ aggregate ownership in the combined group to 16.6% from 14.8% in the earlier proposal, it said.
BHP continues to believe that a combination of the two businesses would deliver significant value for all shareholders.
— BHP CEO Mike Henry
Anglo’s share price was down 0.7% at £27.58.
“We are disappointed that this second proposal has been rejected,” BHP CEO Mike Henry said in a statement.
“BHP continues to believe that a combination of the two businesses would deliver significant value for all shareholders,” the statement said.
The world’s biggest listed miner has until May 22 to log in a binding offer.
Anglo is attractive to its competitors for its prized copper assets in Chile and Peru. The metal is used in everything from electric vehicles and power grids to construction, and demand for it is expected to rise as the world moves to cleaner energy and wider use of artificial intelligence (AI).
But Anglo’s sprawling portfolio also includes platinum, iron ore, steelmaking coal, diamonds and a fertiliser project. The revised bid is still contingent upon Anglo selling its shares in iron ore and platinum assets in SA, a country BHP exited in 2015.
Anglo’s investors are concerned that they stand to lose heavily by holding shares in the SA subsidiaries.
Update: May 13 2024
This story has been updated with comment from Anglo and more information.
Reuters
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