$39 Billion Takeover Offer Of BHP Rejected by Anglo American, Defying Mining Merger Trends

Anglo American, a big mining company, turned down an offer from another big mining company, BHP Group. They said the offer was too low and didn’t reflect how well they’re likely to do in the future.

BHP, which is based in Australia, wanted to buy Anglo-Americans using only its shares. The offer said Anglo American was worth about £31.1 billion ($38.9 billion). If the deal had gone through, it would have made the new company the biggest mining company in the world.

After the offer was made, Anglo-American’s stock price went down a little, while other mining companies’ stocks went up.

Anglo American’s board of directors all agreed to say no to BHP’s offer. They said it wasn’t welcome because it wasn’t asked for and it had too many conditions attached.

BHP's offer valued Anglo American at £31.1 billion
BHP’s offer valued Anglo American at £31.1 billion, aiming to create the world’s largest mining company. (Credits: Jim Plouffe)

The chairman of Anglo American, Stuart Chambers, called BHP’s offer “opportunistic,” which means it seemed like BHP was trying to take advantage of a situation.

BHP hasn’t said anything yet in response to Anglo American’s rejection.

BHP’s offer also included a condition that Anglo American had to give up its shares in two other companies based in South Africa: Anglo American Platinum Limited and Kumba Iron Ore Limited. These two companies make up a big part of Anglo-American copper production.

Anglo-American’s chairman, Stuart Chambers, didn’t like this part of the deal either. He said it would be bad for Anglo American and its shareholders.

After Anglo American turned down the offer, Anglo American Platinum’s stock price went up by 2%, but Kumba Iron Ore’s went down a bit by 0.9%.

Mining Industry Faces Copper Supply Shortages

Mining companies are gearing up for a future where there might not be enough copper, a crucial metal in electric cars, power grids, and wind turbines.

BHP’s bid to buy Anglo American might just be the beginning of a major industry shift, with experts predicting more consolidation.

Anglo-American sees future growth in energy transition and remains confident in its 30% copper production.

John Meyer, a mining analyst, sees BHP possibly targeting Rio Tinto next. Chinese firms are also expected to join the race to secure materials for their green projects.

Despite the offer, Anglo American believes it’s well-positioned to benefit from the energy transition. With 30% of its production in copper, the company sees significant value in its current setup.

Chairman Stuart Chambers is confident in the company’s prospects, anticipating strong returns for shareholders as demand for copper continues to rise.

Sajda Parveen
Sajda Parveen
Sajda Praveen is a market expert. She has over 6 years of experience in the field and she shares her expertise with readers. You can reach out to her at [email protected]
Notify of
Inline Feedbacks
View all comments
Would love your thoughts, please comment.x