Anglo American rejects a third BHP offer but pushes back deal deadline

By Steve Goldstein

New offer is valued at $49 billion, says BHP

Anglo American PLC said Wednesday it has received, and rejected, a third conditional offer from BHP Group Limited, though it's agreed to push back the deadline for its suitor to make a formal bid.

Anglo American (UK:AAL) said the latest terms are 0.8860 BHP shares as well as the demerger of its stakes in Anglo American Platinum Ltd. (ZA:AMS) and Kumba Iron Ore Ltd. (ZA:KIO), which collectively would value it at GBP29.34 per share using April 23 prices.

BHP said that using Wednesday's prices, the offer is valued at GBP31.11 per share, or GBP38.6 billion ($49.2 billion).

Anglo American shares edged up 0.2% to GBP26.92. U.K.-listed shares of BHP (UK:BHP) (BHP) (AU:BHP) fell 3%.

Anglo American said the new bid is still "highly complex" and called its own standalone plan superior.

"The complex process proposed by BHP is likely to take 18 months or more to complete and carries significant execution and completion risks relating to both value and time," the company said.

BHP says it's made progress with Anglo American on deal structure.

"Since the submission of the revised proposal, we have been engaging with Anglo American and its advisors to help mitigate the concerns associated with the implementation of this structure that led to the rejection of the revised proposal. We have made progress on these topics over the course of the engagement so far, and we are hopeful that resolution will be reached in the next seven days," the company said.

Anglo American said it's received permission to extend the deadline for BHP to launch a formal bid, to May 29.

BHP said the combined group would have a leading portfolio of large, low-cost, long-life Tier 1 assets focused on iron ore and metallurgical coal and future-facing commodities, including potash and copper. Anglo American's other high-quality businesses, including its diamond business, would be subject to a strategic review after completion.

Anglo American's plan calls for it to divest its steelmaking coal business, demerge its stake in Anglo American Platinum and explore "a full range of options" with respect to De Beers.

-Steve Goldstein

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05-22-24 1007ET

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