13th May 2024 15:21
(Alliance News) - Anglo American PLC talked up its standalone prospects as it shrugged off another tilt from BHP Group Ltd, though it may not be the suitor's last.
BHP has a put up or shut up deadline of May 22, just over a week from now, so it could announce another approach before then.
German bank Berenberg sees "scope for another revised bid from BHP", but does not believe it will be much chunkier. It also predicts another mining player could enter the fold, Glencore PLC for example.
The new all-share offer from Melbourne-based BHP values London-based Anglo at GBP34 billion, up from GBP31.1 billion under its previous offer. BHP is offering 0.813 of a BHP share for each Anglo share, giving a current value to Anglo shares of GBP27.53 each, based on BHP's own price.
Anglo shares were down 0.7% to 2,754.00 pence each in London on Monday afternoon.
BHP has its primary listing in Sydney. In London, its shares were quoted at 2,288.00p, down 0.4%.
The revised proposal represents a 15% improvement in the merger exchange ratio, BHP noted. It increases the holding that Anglo shareholders would have in the combined entity to 16.6% from 14.8% previously.
BHP also offered Anglo two positions of the board of the combined company.
However, BHP said that Anglo rejected its revised proposal on Monday.
"BHP put forward a revised proposal to the Anglo American board that we strongly believe would be a win-win for BHP and Anglo American shareholders," said BHP Chief Executive Officer Mike Henry. "We are disappointed that this second proposal has been rejected."
As part of the proposed deal, BHP wants Anglo American to split off Anglo American Platinum Ltd and Kumba Iron Ore Ltd in South Africa.
South Africa's state-owned asset management firm Public Investment Corp last week signalled that it remains open-minded about BHP's bid for Anglo-American. PIC has a 7.0% stake in Anglo American, according to Morningstar.
Berenberg summarised: "We continue to see some upside in Anglo American’s share price on bid speculation, with downside risk to BHP’s share price."
By Eric Cunha, Alliance News news editor
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Related Shares:
Anglo AmericanBHP GroupGlencore