Anglo American’s board has rejected a third unsolicited, non-binding and highly conditional takeover proposal of £29.34 ($37.32) a share from the BHP Group.
It, however, agreed to a one-week extension to the “put up or shut up (PUSU)” deadline under UK takeover rules.
“The Board considered BHP’s latest proposal carefully, concluded it does not meet expectations of value delivered to Anglo American’s shareholders, and has unanimously rejected it,” said Anglo chairperson Stuart Chambers.
“In particular, it does not address the board’s concerns about the structure, which results in significant complexity, execution risks, an extended timeline to completion and consequently has the potential for material value leakage to be disproportionately suffered by Anglo American’s shareholders.”
The latest proposal includes the same highly complex structure as the proposals previously rejected on 26 April and 13 May 2024.
This involves an all-share offer for Anglo American by BHP, with a requirement for Anglo American to complete two separate demergers of its entire shareholdings in Anglo American Platinum Limited and Kumba Iron Ore Limited to Anglo American shareholders.
The all-share offer and required demergers would be inter-conditional.
Anglo said the board and its advisers have engaged with BHP and its advisers on multiple occasions with a particular focus on the proposed structure and associated risks.
“The requirement to pursue two contemporaneous demergers of publicly listed companies alongside a takeover and the inter-conditional nature of the three transactions is unprecedented, and as a result of a takeover would result in additional material approvals and conditions, particularly in South Africa,” it said.
Anglo further said that BHP’s latest proposal is in clear contrast to its simpler standalone plan to accelerate value delivery announced on 14 May 2024 and its proposal to demerge Anglo American Platinum.
It said 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.
Mathew Nyaungwa, Editor in Chief of the African Bureau, Rough&Polished
