Anglo American rejects second BHP offer for US$42.7 billion

The British mining company Anglo American This Monday it rejected an improved purchase offer from its Australian rival BHP which expanded the shareholders’ stake in the combined group to a total valuation of 34 billion pounds (about $42.7 billion).

The CEO of BHP, Mike Henryregretted that his second proposal, made on May 7, was rejected and that maintained the same basic structure as last April, revealing the details in a statement to the London Stock Exchange.

The revised offerincreases the aggregate ownership of Anglo American shareholders in the combined group to 16.6%, from 14.8% in the first offer,” the executive stated.

This represents a total value of approximately £27.53 (about $34.5) per Anglo American ordinary share – including £4.86 ($6.10) and £3.4 ($4.26) in shares of its subsidiaries Anglo Platinum and Kumba, respectively -, which values ​​Anglo American’s share capital at around 34 billion pounds (about 42.7 billion dollars), according to the note.

Henry insisted that BHP and Anglo American “They are a strategic fit and the combination is a unique and compelling opportunity to unlock significant synergies by uniting two highly complementary world-class businesses.”

The combined business “would have a leading portfolio of high-quality assets in copper, potash, iron ore and metallurgical coal and BHP would bring its track record of operational excellence to maximize returns on these high-quality assets,” he added.

On April 26, the board of Anglo American announced its unanimous rejection of the purchase offer initially raised by BHP, equivalent to about 31.1 billion pounds (about 39 billion dollars), considering that it undervalued the company and its prospects.

According to the FT, Anglo American also concluded that the structure was complex and did not approve of being forced to split up its two subsidiaries in South Africa.

According to the newspaper, BHP now has until Wednesday to decide whether to make a formal offer, which could result in a battle between both companies in the face of a hostile takeover.