The BHP all-scrip offer values Anglo American at £31.1 billion ($59.6 billion) with Anglo American investors to receive 0.7097 of BHP stock for each share.
Already a subscriber?BHP is doubling down on its big bet on copper demand growing exponentially in the global shift away from fossil fuels with a bold takeover bid for the British resources heavyweight Anglo American that values it at nearly $60 billion.
Copper is used in infrastructure and renewable energy farms. It is also counting on huge demand from the urbanisation of ten of millions of people across China and India, as well as in electrification of energy and transportation.A successful deal would push BHP ahead of its rivals as the world’s biggest copper producer, increase its footprint in coking coal mining in Queensland’s Bowen Basin and boost its iron ore presence in Brazil.
Jefferies analysts suggested BHP might face competition in its quest for Anglo American. The broker said the takeover target was a good strategic fit for BHP and other major miners because of potential synergies, asset quality and commodity exposure – particularly in copper. Shares of Anglo American have fallen 12 per cent over the past 12 months, giving the company a market value of £27 billion on Wednesday’s price. BHP has a market value of about $230 billion.It is understood that BHP also identified synergies in the Australian coking coal operations – specifically the Moranbah, Dawson, Grosvenor and Aquila mines – and in Anglo American’s iron ore business in Brazil that was boosted by an acquisition and infrastructure access deal with Vale.
Kumba is the world’s fifth-largest iron ore producer with a market capitalisation of about $11.9 billion. Iron ore contributed $US4 billion to Anglo American’s underlying earnings of $US10 billion last year, followed by copper , coking coal and platinum .
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