BHP Group (BHP) has provided an update on its offer for Anglo American, proposing several socioeconomic measures to address the concerns regarding the proposed transaction structure. BHP emphasizes the need for a further extension of the deadline to facilitate additional discussions on its proposal.
BHP remains confident that the proposed measures present a viable solution to the issues raised by Anglo American and would help secure South African regulatory approvals. They assert that these measures promise greater economic benefits to South Africa compared to Anglo American's Accelerating Value Delivery plan, reduce perceived value and completion uncertainties, and ensure that costs are not disproportionately borne by Anglo American shareholders.
Furthermore, BHP has expressed willingness to discuss an appropriate reverse break fee, payable by BHP, should they fail to obtain the necessary anti-trust and regulatory approvals, including those in South Africa.
BHP continues to advocate that Anglo Platinum and Kumba Iron Ore, as major standalone entities listed on the Johannesburg Stock Exchange (JSE) with significantly increased JSE index weightings, would yield clear benefits for the South African government, economy, and communities. These entities would be independently managed by established South African-based teams.
However, on May 22, 2024, Anglo American rejected BHP's third takeover proposal of 29.34 pounds per share. BHP’s new proposal had increased the number of shares offered to Anglo American but required Anglo American to separately demerge its shareholdings in Anglo American Platinum Limited and Kumba Iron Ore Limited to its shareholders.
Anglo American declined the proposal, citing that the demerger combined with the takeover would likely take 18 months, negatively impacting the material transaction and shareholder value.
