“If BHP was serious about closing the valuation gap, how about giving the Aussie holders something we prize - franking creditsUS$16bn in franking credits are better placed in the hands of Aussie holders than sitting on balance sheet”
You’d think that would be on the table wouldn’t you ? But such things are waaaay down the priority list at BHP HQ.
In fact I managed to get hold of a transcript from the last board meeting - here’s a brief extract that illustrates the problem.
Chair : “Ok I think that just about wraps things up for today.....we’ve updated our diversity, equity, sustainability, ethics and whistleblowers policies, discussed at length selling off more core business to get the super funds off our case, got to the bottom of those tricky little issues with the all gender toilets, agreed on all the finer details regarding our Christmas Cruise and approved the 60% increase in directors fees and benefits for all of us around the table......now .....”
Phil : “We haven’t discussed the mine closures and the supply chain issues ...there are some critical...”
Chair : “We haven’t got time for that Phil ....any other business....anyone ?”
Bob : “Yes I just wanted to draw everyone’s attention to the US$16b worth of franking credits sitting idle on our balance sheet and given the raw deal our Australian shareholders got with the decoupling from the London exchange I thought there might just be an opportunity.....”
Chair : “JESUS CHRIST BOB.....that’s 3 meetings in a row you’ve tried to shoehorn in the f#*king franking credits - do franking credits give off CO2 Bob - huh ?........Do I have ferals outside in the street here chanting and waving banners about franking credits ??? They can sit in the balance sheet forever for all I care - give it a rest Bob - no ones f#*king interested”
Bob : “But it’s a pretty big deal for shareholders....and isn’t that our main role.....to act in the best interests of shareholders ?”
Chair : “MEETING CLOSED - now where’s lunch ?”(uproarious laughter around the table)
End of Transcript
BHP Price at posting:
$38.03 Sentiment: Hold Disclosure: Held
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(20min delay)