BHP (ASX, NYSE, LON: BHP) has dropped its latest approach to buy Anglo American (LON: AAL) after attempting to disrupt Anglo’s planned $53-billion merger with Canada’s Teck Resources (TSX: TECK.A/TECK.B).
The world’s largest miner contacted Anglo’s board last week as Teck and Anglo shareholders prepared for a Dec. 9 vote on the deal. BHP withdrew the offer Monday, saying it still sees strategic merit in a tie-up but remains confident in its own growth plan.
“While BHP continues to believe that a combination with Anglo American would have had strong strategic merits and created significant value for all shareholders, BHP is confident in the highly compelling potential of its own organic growth strategy,” BHP general counsel Stefanie Wilkinson said in the release.
Anglo, long viewed as a takeover target due to its copper portfolio, has deterred buyers with its mix of niche assets including diamonds and platinum. BHP made a $49-billion bid last year but walked away after Anglo rejected a structure that required spinning off those units in South Africa.
Since then, Anglo’s share performance has outpaced BHP’s. Anglo’s market value in London is about $42 billion, compared with BHP’s $132 billion, according to LSEG data, making a valuation agreement tougher.
Time to move on
Investors said BHP’s renewed interest reflects its push to secure more copper, though many questioned the timing. Hugh Dive of Atlas Funds Management said BHP shareholders were surprised the company was still pursuing Anglo. Stephen Butel at Platypus Asset Management said BHP should sharpen operations and cut costs instead of adding complexity. Joseph Koh at Blackwattle Investment Partners called Anglo a quality copper producer but added that it was time for BHP “to move on”.
Anglo and Teck operate neighbouring copper mines at the foot of the Andes Mountains in Chile. Their merger would form a top-five global copper producer, strengthening a key supply chain for energy transition infrastructure.
(With files from Reuters)
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BHP (ASX, NYSE, LON: BHP) has dropped its latest approach to buy Anglo American (LON: AAL) after attempting to disrupt Anglo’s planned $53-billion merger with Canada’s Teck Resources (TSX: TECK.A/TECK.B).
The world’s largest miner contacted Anglo’s board last week as Teck and Anglo shareholders prepared for a Dec. 9 vote on the deal. BHP withdrew the offer Monday, saying it still sees strategic merit in a tie-up but remains confident in its own growth plan.
“While BHP continues to believe that a combination with Anglo American would have had strong strategic merits and created significant value for all shareholders, BHP is confident in the highly compelling potential of its own organic growth strategy,” BHP general counsel Stefanie Wilkinson said in the release.
Anglo, long viewed as a takeover target due to its copper portfolio, has deterred buyers with its mix of niche assets including diamonds and platinum. BHP made a $49-billion bid last year but walked away after Anglo rejected a structure that required spinning off those units in South Africa.
Since then, Anglo’s share performance has outpaced BHP’s. Anglo’s market value in London is about $42 billion, compared with BHP’s $132 billion, according to LSEG data, making a valuation agreement tougher.
Time to move on
Investors said BHP’s renewed interest reflects its push to secure more copper, though many questioned the timing. Hugh Dive of Atlas Funds Management said BHP shareholders were surprised the company was still pursuing Anglo. Stephen Butel at Platypus Asset Management said BHP should sharpen operations and cut costs instead of adding complexity. Joseph Koh at Blackwattle Investment Partners called Anglo a quality copper producer but added that it was time for BHP “to move on”.
Anglo and Teck operate neighbouring copper mines at the foot of the Andes Mountains in Chile. Their merger would form a top-five global copper producer, strengthening a key supply chain for energy transition infrastructure.
(With files from Reuters)