BHP proposes takeover of Anglo American in mining mega-deal â business live | Business
Introduction: BHP proposes takeover of Anglo American
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
Thereâs takeover excitement in the mining world this morning after Australiaâs BHP made a takeover approach for smaller rival AngloAmerican
The deal, if completed, would be one of the largest in the sector for years, and create the worldâs biggest copper miner.
Anglo confirmed overnight that it had received an âunsolicited, non-binding and highly conditionalâ all-share buyout proposal from BHPGroup, which it is currently examining.
The proposal is conditional on Anglo first splitting off its South African platinum and iron ore units, suggesting BHP is primarily interested in Angloâs copper resources.
Anglo says:
The Board is currently reviewing this proposal with its advisers. There can be no certainty that any offer will be made nor as to the terms on which any such offer might be made.
Pending any further announcements Anglo American shareholders should take no action. A further announcement will be made as and when appropriate.
Anglo had been seen as a potential takeover target since late last year, when it warned that production had been weaker than expected. Shares are down around 10% over the last 12 months.
BHPâs interest in acquiring Anglo raises fresh concerns about an exodus of UK firms from London.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, explains:
ââThe buyout offer from BHP, the worldâs largest publicly listed miner, for Anglo American, wonât just shake up the mining industry, but will send a fresh chill through the City of London
There are concerns that if the deal goes through it could be the tip of the iceberg and more giants could leave the exchange. It comes hot on the heels of speculation that Shell might up sticks and leave for New York, rumours that Ocado may be considering leaving for the Big Apple, and follows the crushing disappointment of home-grown chip designer Arm choosing the Nasdaq over the FTSE 100.
The agenda
9am BST: European Central Bankâs economic bulletin
11am BST: CBIâs distributive trades survey of UK retailers
1.30pm BST: US GDP report for Q1 2024
3pm BST: US pending home sales data for March
Key events
Barclays profits drop 12%
BHPâs pursuit of Anglo comes on a busy morning for corporate news in London.
Barclays bank has reported a 12% drop in pre-tax profits for the last financial year.
The decline was partly due to lower income from deposits and mortgages, and weaker income from investment banking.
C. S. Venkatakrishnan, Barclays CEO, says the bank is focused on executing the shake-up plan announced in February (which will cut costs and jobs), adding:
We have now announced the sale of our performing Italian mortgage book and are investing in our higher returning UK consumer businesses, including through the expected completion of the Tesco Bank acquisition in Q424.
IFBHP was to take control of Anglo, the combined company would produce around 10% of global output of copper, Reuters points out.
BHPâs proposal to Anglo could potentially flush out other rival suiters, who are also keen to own its copper mines.
âIf BHP does indeed continue to pursue this deal, we would be surprised if other bidders do not emerge,â analysts from Jefferies LLC led by Christopher Lafemina said in an emailed note.
A bid that values Anglo at $42.6 billion â a 28% premium based on its latest share price â might get a deal âacross the finish line,â they said.
Copper hit a two-year high earlier this month, with traders betting that supply will struggle to keep up with demand.
Introduction: BHP proposes takeover of Anglo American
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
Thereâs takeover excitement in the mining world this morning after Australiaâs BHP made a takeover approach for smaller rival AngloAmerican
The deal, if completed, would be one of the largest in the sector for years, and create the worldâs biggest copper miner.
Anglo confirmed overnight that it had received an âunsolicited, non-binding and highly conditionalâ all-share buyout proposal from BHPGroup, which it is currently examining.
The proposal is conditional on Anglo first splitting off its South African platinum and iron ore units, suggesting BHP is primarily interested in Angloâs copper resources.
Anglo says:
The Board is currently reviewing this proposal with its advisers. There can be no certainty that any offer will be made nor as to the terms on which any such offer might be made.
Pending any further announcements Anglo American shareholders should take no action. A further announcement will be made as and when appropriate.
Anglo had been seen as a potential takeover target since late last year, when it warned that production had been weaker than expected. Shares are down around 10% over the last 12 months.
BHPâs interest in acquiring Anglo raises fresh concerns about an exodus of UK firms from London.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, explains:
ââThe buyout offer from BHP, the worldâs largest publicly listed miner, for Anglo American, wonât just shake up the mining industry, but will send a fresh chill through the City of London
There are concerns that if the deal goes through it could be the tip of the iceberg and more giants could leave the exchange. It comes hot on the heels of speculation that Shell might up sticks and leave for New York, rumours that Ocado may be considering leaving for the Big Apple, and follows the crushing disappointment of home-grown chip designer Arm choosing the Nasdaq over the FTSE 100.
The agenda
9am BST: European Central Bankâs economic bulletin
11am BST: CBIâs distributive trades survey of UK retailers