megamillionswinners| Anglo American shares rise after rejecting BHP Billiton's 100 billion takeover

Interface News reporter | Hou Ruining

Only every other day.MegamillionswinnersAnglo American rejected BHP's proposed acquisition of hundreds of billions of yuan.

On April 26, Anglo American announced that BHP's proposal seriously underestimated Anglo and its future prospects. In view of the uncertainty and complexity inherent in the proposal and the significant implementation risks, the board considered that the structure envisaged in the proposal was unattractive to Anglo shareholders. As a result, the board of directors unanimously rejected the proposal.

On April 25, Anglo American announced on its website that it had received an unsolicited all-share merger proposal from BHP Billiton and that the board was evaluating it.

BHP Billiton's proposal is non-binding and conditional on requiring Anglo American to spin off its entire shares in Anglo Platinum and Kumba Iron Ore Limited to Anglo shareholders before a formal acquisition.

On the same day, BHP also confirmed that it had made an all-share offer to Anglo American, valuing Anglo at 311 pounds (279.9 billion yuan).

In an announcement on April 26th, Anglo chairman Stuart Chambers said Anglo is fully capable of generating significant value from its high-quality portfolio, which is very consistent with the energy transformation and other major demand trends.

Copper, which accounts for 30 per cent of Anglo American's total production, together with other attractive products, will gradually increase in value, Stuart Chambers said. The board believes that as the impact of these trends becomes apparent, Anglo shareholders will benefit from the expected significant value gains.

Stuart Chambers said BHP's proposal was opportunistic, failed to add value to Anglo's prospects and greatly diluted the relative value of Anglo shareholders' stakes relative to BHP shareholders.

He believes that the proposal creates a great deal of uncertainty and that the risk of implementation is almost entirely borne by Anglo American, shareholders and other stakeholders. Anglo American shareholders are advised not to take any action on the takeover offer.

Anglo American said that according to the relevant provisions of the acquisition Law, BHP must announce its intention to acquire Anglo by 5pm on May 22, or announce that it does not intend to do so.

Anglo American shares rose 2% on April 26 after rejecting the BHP proposal.Megamillionswinners.99% to $16.53 per share, with a total market capitalization of $44.22 billion; BHP shares fell 1.36 per cent to $56.43 per share, with a total market capitalization of $142.932 billion.

Founded in 1917, Anglo American operates in copper, iron ore, metallurgical coal and thermal coal, as well as diamonds (through de Beers) and platinum.

Last year, Anglo American produced 826000 tons of copper, up 24 per cent from a year earlier. The company is expected to maintain copper production at 730000-790000 tons in 2024.

In terms of equity, BHP Billiton produced about 1.2 million tons of copper in 2023 and Anglo American 826000 tons. If the two sides merge, the new group will account for nearly 10 per cent of global copper supply. The latest report released by the World Bureau of Metal Statistics shows that global copper production last year was 22.3641 million tons.

Last year, due to cyclical weakness such as diamonds and platinum, Anglo's overall commodity prices fell by 13 per cent and unit costs increased by 4 per cent, leading to a sharp decline in Anglo's performance.

Last year, Anglo's revenue was $30.7 billion, down 13 per cent from a year earlier; profits attributable to equity shareholders were $283 million, down 94 per cent from a year earlier; and free cash flow was-$1.385 billion, down 187 per cent from a year earlier.

BHP's results for the first half of 2024 (July 1 to December 31, 2023) showed revenue of $27.2 billion, up 5.91 per cent from a year earlier, and net profit of $972 million, down 86 per cent from a year earlier.