Anglo American rejects calls from suitor BHP to extend takeover talk
Anglo American has rejected calls from suitor BHP to extend takeover talks for a potential deal worth almost £39bn.
The companies have been in talks over a deal worth almost £39bn since Wednesday May 22 amid efforts to agree on the structure for a potential takeover.
Australia’s BHP said it had put forward a number of “socioeconomic measures” in a bid to ease concerns over its bid and called for more time to discuss this with Anglo American.
BHP’s three takeover approaches all had a requirement for its rival to spin off its South African operations, resulting in heavy criticism from the government in Pretoria.
Anglo American also opposed this. In a statement on Wednesday, BHP said: “BHP believes that the proposed measures it has put forward provide substantial risk protection for Anglo American shareholders and supplement the significant value uplift that Anglo American shareholders will receive from the potential combination.
“BHP believes a further extension of the deadline is required to allow for further engagement on its proposal. This announcement does not amount to a firm intention to make an offer and there can be no certainty that an offer will be made.”
In a statement, Anglo American said: “BHP has not addressed the board’s fundamental concerns relating to the disproportionate execution risk associated with the proposed structure and the value that would ultimately be delivered to Anglo American’s shareholders.
“Also taking into consideration detailed feedback from the board’s extensive engagement with Anglo American’s shareholders and stakeholders, the board has therefore unanimously concluded that there is no basis for a further extension to the Pusu (put up or shut up) deadline.”
Anglo American’s vast reserves of copper are a key driver of the interest in the business, as the mineral is an important building block for low-carbon technologies such as solar farms and electric cars.
Earlier this month, Anglo American announced plans to break up major parts of the business and heavily slow down its development of a £7bn North Yorkshire fertiliser mine, the Woodsmith project. Anglo American said that following completion of its asset review initiated during 2023, it plans to implement a number of major changes to its portfolio.
The statement added: “As a result of this review, the development of the Woodsmith project will slow to support Anglo American’s balance sheet deleveraging.”
Speaking at the time, Tom McCulley, CEO of Anglo American’s Crop Nutrients business, said: “Anglo American has again stated today that Woodsmith is central to its growth plans as a Tier 1 resource – entirely aligned with the demand trends of decarbonisation and food security.
“We have been progressing the project on time and on budget but have decided to slow development in the near term. I’m incredibly proud of the progress we have made so far, the positive impact on the local area and the partnerships we have built in our local communities, which we will continue to engage positively with.”