BHP makes new takeover approach to Anglo American: report
BHP Group has embarked on a new takeover approach of Anglo American in a bid to disrupt the London-listed miner’s merger with Canada’s Teck Resources; This is the latest in a wave of consolidation sweeping the industry.
According to sources familiar with the matter, the world’s largest miner has made an offer to Anglo American in recent days. Some said BHP’s offer was a mix of cash and shares. Anglo American’s market value is around £31.9 billion ($64.7 billion), while BHP, which failed to acquire the smaller company last year, has a market value of more than $130 billion.
For BHP and CEO Mike Henry, the move will represent a test of how far the company is willing to go in its copper growth efforts.Credit: Bloomberg
BHP’s new approach comes less than three weeks before shareholders in Anglo and Teck are due to vote on a deal to create a new copper giant with a total value of more than US$60 billion, as announced in September. The move extends a years-long deal-making boom affecting the biggest miners, driven largely by a desire to expand in copper, which is increasingly critical for its role in electrification.
Negotiations are ongoing and there is no certainty a deal will be reached between BHP and Anglo, said the people, who asked not to be named due to private information. Two of the sources said Anglo briefed Teck on the BHP approach at the weekend. Representatives for BHP, Anglo and Teck declined to comment.
Like Teck, Anglo has long been seen as a potential takeover target for the industry’s biggest players due to its attractive copper portfolio. But buyers were largely put off by Anglo’s eclectic mix of other relatively niche assets, ranging from diamonds to platinum.
BHP tried to buy Anglo for $49 billion last year in a complex deal that required the smaller company to partially break itself up by offloading majority stakes in two South African miners, but BHP eventually pulled out after a five-week public battle.
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Anglo had repeatedly rejected BHP’s offers at the time as being too complex and undervaluing its business, and instead rushed through a comprehensive restructuring plan that chief executive Duncan Wanblad promised would deliver better returns to shareholders. The company has since exited the platinum business in South Africa, potentially making it more digestible for BHP, but has not yet signed off on plans to divest its coal and diamond units.
Some said BHP’s latest offer was structured more simply and clearly than last year’s.
