BHP pulls out $49bn Anglo American mining mega-merger

Daba Finance/BHP walks away from $49bn takeover offer for Anglo American

AFRICAN BUSINESS AND ECONOMYMay 29, 2024 at 9:47 PM UTC

TLDR

BHP Group ends $49 billion takeover attempt for Anglo American due to unresolved South African regulatory risks and lack of key information from Anglo.
Anglo American rejects BHP's request for deadline extension, highlighting the complexity of the deal negotiation.
Decision-making process centered around concerns over costs, regulatory risks, and information gaps.

BHP Group announced on Wednesday that it would not proceed with a formal offer for Anglo American, effectively ending its $49 billion takeover attempt.

This decision came after Anglo American declined to extend the bid deadline further. BHP cited unresolved concerns over South African regulatory risks and costs, and a lack of "key information" from Anglo American needed to address these issues.

Anglo American dismissed BHP's last-minute request for more time to negotiate the complex deal, having already extended the original May 22 deadline by one week.

Key Takeaways

BHP Group's intended acquisition of Anglo American was primarily driven by interest in Anglo's valuable copper business, crucial for the energy transition. However, BHP had no interest in Anglo's South African operations, specifically Anglo American Platinum and Kumba Iron Ore. The deal's complexity, requiring Anglo to demerge these businesses, was deemed too risky by Anglo's board. Despite BHP improving its all-share bid three times, disagreements over the deal's structure persisted. Consequently, Anglo American described the offer as "highly complex and unattractive." Following the news, Anglo's shares fell by 4%, closing at £24.58 in London.

BHP Group

Anglo American

Mining

South Africa

Merger

Acqusition