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Anglo American Investors Open to a Takeover if the BHP Deal Is Simplified

  • Major Anglo American shareholders favor a simpler takeover bid from BHP compared to BHP's proposed plan involving breakups.
  • BHP has until Wednesday to submit a revised bid or abandon its takeover attempt.
  • Anglo American has proposed its own restructuring plan to unlock shareholder value and remain independent.
Mining

BHP has until Wednesday to return with a binding offer or walk away under UK takeover rules

Major shareholders in Anglo American are reportedly open to accepting a simpler takeover bid from its bigger rival BHP, which could create a mining juggernaut.

The Telegraph reported that two major Anglo investors said BHP’s current plan to break up the business was too complicated but suggested they would consider a revised bid that did away with this element.

“Taking away that conditionality can improve things,” one of Anglo’s 15 biggest investors said.

A City fund manager who holds stock in the miner added: “BHP needs to understand how complex this deal looks to investors. They are going to end up with all sorts of bits and pieces. I would prefer BHP to do the heavy lifting and take away all of Anglo.”

The news comes ahead of a deadline on Wednesday for Australia-based BHP, which is the world’s largest publicly-listed mining company, to return with a binding offer or walk away under UK takeover rules.

FTSE 100-listed Anglo has already rejected two proposals from BHP since last month, the first valuing it at £31bn and the second at £34bn.

The latter would have required Anglo to offload its Kumba iron ore operation and Amplats platinum miner in South Africa in a bid that the company said was “highly unattractive”.

Anglo has scrambled to propose its own plans to unlock more value for shareholders and remain independent by offloading parts of the business and focusing on energy transition metal copper.

Plans include selling its coking coal business, cutting its investment in UK fertilizer mine Woodsmith, and demerging or selling diamond brand De Beers, which could reportedly include a London IPO for the historic arm.

Anglo will also spin-off its 79 percent stake in Amplats, echoing BHP’s proposal for the business.

Anglo and BHP declined to comment.

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