...no doubt this is a bold acquisition by BHP, its biggest yet and could well be a defining one.
...the British market however has not warmed up to BHP's offer, sold down BHP by almost -3% and lifting Anglo American's price by +15%.
BHP produced about 1.2 million tons of copper in 2023 on an equity basis, while Anglo’s output was 826 000 tons. That would give the combined group roughly a 10% share of global mine supply.
Jefferies said antitrust issues “would likely be a problem” for the deal since governments consider copper a strategic mineral.
It’s also possible that the proposal for Anglo could now prompt others to make a move. No. 2 miner Rio Tinto Group has also been investing in copper production, while Glencore Plc last year made an unsuccessful offer for Teck Resources, which has a coveted copper business, before eventually reaching a deal for the Canadian company’s coal assets.
Anglo’s valuation may make it more attractive, but it remains a highly complicated business.
The company owns majority stakes in two South African-listed miners — Anglo American Platinum and Kumba Iron ore — and is the majority owner of diamond miner De Beers. It also has a long and complicated relationship with South Africa, where the state pension fund manager is its biggest shareholder.
BHP’s proposal was to first hand Anglo’s stakes in the two South African businesses to the smaller company’s investors before proceeding with a takeover, Anglo said. The two parts of the proposal would be “interconditional,” it said.
Anglo’s other operations include copper, nickel, steelmaking coal and Brazilian iron ore, as well as the iconic De Beers business.
