So, we're now at the pointy end of BHP's (ASX:BHP) monthly long attempt to grab its stumbling rival, Anglo American.
BHP lobbed a third offer overnight Wednesday just before the 5 p.m. London time deadline for a formal offer. Anglo American said ‘no’ for a third time but granted BHP a week-long extension to see if a deal can be done.
The extension means it's 'put up or shut up' time for the two companies, and the future of the $A71 billion plus deal will rest on the Australian company’s determination not to be involved in South Africa.
BHP’s third proposal again included demands for Anglo to unbundle its platinum and iron ore assets in South Africa, a process Anglo has previously deemed too risky and complex.
BHP says Anglo has to agree to de-merge from Anglo American Platinum Ltd. and Kumba Iron Ore Ltd, despite wanting to keep Anglo’s Brazilian iron ore business.
Anglo confirmed the third proposal from BHP at about £29.34 ($US37.33) per Anglo American share, based on undisturbed share prices as of the market close on April 23. The offer values the company at £38.6 billion or more than $A71 billion. The bid also again included demands for Anglo to unbundle its platinum and iron ore assets in South Africa, a process Anglo has previously deemed too risky and complex.
“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,” Anglo American Chairman Stuart Chambers told the market in a statement to the London Stock Exchange.
“However, the Board is willing to continue to engage with BHP and its advisers on this topic and has therefore requested a one-week extension to the PUSU deadline which has been consented to by the (Takeovers) Panel,” Chambers added.
Shares of Anglo American rose shortly after the announcement before falling 0.9% to £26.62. BHP shares fell more than 4% in trading in London and New York.
In view of the rattling Wall Street took from some hawkish minutes from the Fed on Wednesday, BHP shares will come under more pressure on the ASX today (Thursday).
Anglo later announced plans to demerge the 85% De Beers diamond unit, as well as its steelmaking coal in Queensland and the small nickel and larger platinum businesses.
