Anglo American rejects BHP's extended negotiation request

sxcoal.com Company 2024-05-30 13:58:23

Anglo American declined BHP's request for more time to continue acquisition talks on May 29, indicating a big likelihood of failure for its six-week pursuit.

 

Under UK acquisition regulations, BHP was required to either finalize a contract with Anglo American by 5:00 PM on May 29 or temporarily halt its acquisition efforts. One week earlier, the global mining giant had its third offer of over $49 billion rejected by Anglo American, although the latter agreed on a one-week extension to its original May 22 deadline.

 

A major issue in the acquisition has been the future of Anglo American's platinum and iron ore operations in South Africa, as BHP has been adamant about the divestment of these assets prior to the acquisition.

 

Founded in Johannesburg in 1917, Anglo American now employs over 40,000 people in South Africa, and the potential divestment could economically impact the region. Analysts from J.P. Morgan have estimated that the acquisition could lead to a $4.3 billion capital outflow from South Africa and weaken the South African Rand.

 

This deal comes amid South Africa's most competitive national elections since the end of apartheid 30 years ago. Pre-election polls indicated that the ruling African National Congress is likely to secure the most votes, although its share might drop below 50% for the first time, influenced by economic downturns, energy crises, high unemployment, and crime rates.

 

To appease South African regulators, BHP had previously proposed maintaining staffing levels at Anglo American's Johannesburg office for at least three years, listing BHP shares on the South African market, and sharing the costs of increasing staff in South Africa. On the same day, the mining giant reiterated these commitments.

 

Analysts suggest that BHP's concessions aim to secure Anglo American's valuable copper assets in South America, a goal openly desired by BHP CEO Mike Henry.

 

Matthew Haupt, Chief Investment Officer at Wilson Asset Management, a shareholder in BHP, said if negotiations cannot progress in a sincere manner, he was content with BHP ultimately abandoning the merger.

 

Although he would like to see the merger continue, it is necessary to maintain some discipline.

 

Anglo is attractive for its prized copper assets in Chile and Peru, a metal used in everything from electric vehicles and power grids to construction, whose demand is expected to rise as the world moves to cleaner energy and wider use of artificial intelligence.

 

(Writing by Alex Guo  Editing by Harry Huo)
For any questions, please contact us by inquiry@fwenergy.com or +86-351-7219322.

Share this article
Connect with us

Editor's Pick

1 Indonesian thermal coal dented by inactive demand from China 2024-06-14

The Indonesian thermal coal market continued to face tepid demand from China, as abundant supplies and persistent price gaps discouraged buyers from engaging in transactions.Plentiful prompt-delivery

2 China's finished steel stocks decline further in early Jun, CISA 2024-06-14

Inventory of five major steel products in China's 21 cities was down for the ninth straight session in early June (June 1-10), falling 0.8% from late May to 10.53 million tonnes, according to data fro

3 Weekly China coal market news summary (Jun 11-Jun 14) 2024-06-14

N China ports thermal coal prices little changedThermal coal prices were broadly firm at northern China ports, with sellers still pricing in the potential for demand improvement before peak summer mon

4 Weekly global coal market news summary (Jun 11-Jun 14) 2024-06-14

Int'l thermal coal prices fall amid wait-and-see sentimentThe international thermal coal market weakened last week. Supply was stable at major exporting countries, but demand from major import countri

5 China's coking coal stocks build as sales slacken; seaborne coal trades dip 2024-06-14

Coking coal stocks accumulated at mines in Chinese major production areas, as miners' sales were dampened by lower buying interest from coking plants and traders.Coking plants purchased the material o

6 China's mine-mouth thermal coal market remains stable 2024-06-14

China's mine-mouth thermal coal market remained largely stable, apart from some mines modestly adjusting prices based on sales conditions.Of the 100 coal mines surveyed by Sxcoal over June 6-12, 15 mi

7 Zhejiang Energy opens new coal import channel at Fujian port 2024-06-14

Zhejiang Energy Group Co., Ltd. said recently it had imported coal through Kemen port in Fujian province for the first time, following the arrival of 130,000 tonnes of high-quality Australian thermal

8 US coal output estimated to rise 5.78% on mth in wk ending Jun 8 2024-06-14

The US's coal output over the 23rd week ending June 8 was predicted at 9.21 million shorty tons (8.35 million tonnes), increasing 5.78% week on week but down 19.69% compared with the corresponding per

9 China futures market updates at close (Jun 14) 2024-06-14

Check out latest updates on the Chinese futures market for coking coal, coke, iron ore and others at close.

10 China Coal Daily Track (Jun 14) 2024-06-14

Thermal coalProduction area Mine-mouth thermal coal prices remained stable in major producing regions, while a few price-competitive mines raised prices amid favorable offtakes, as end buyers made sta

Most Read Articles

1 Indian Railways boosts coal transportation to utilities by nearly 10% YoY 2024-06-11

Indian Railways transported 9.3% more coal to power plants in May this year than the same period last year, in order to help plants meet the surging electricity demand in the country during the scorch

2 Taiwan May coal imports up 1.6% on mth 2024-06-11

Coal imports of China's Taiwan slightly increased in May both on the year and on the month, yet it remained at a low level compared to the same month of previous years, preliminary customs data showed

3 China Coal Daily Track (Jun 11) 2024-06-11

Thermal coalProduction area Thermal coal prices ticked up in major producing regions. Metallurgical and chemical plants made active purchases, and traders at railway stations showed stable interest in

4 China May coal imports still high despite MoM decrease 2024-06-11

China's coal imports continued to register double-digit year-on-year growth in May, going against expectations of decline after the record import in 2023 and the reinstatement of import tariffs.China

5 China's coastal coal freight rates tumble amid weak demand 2024-06-11

Freight rates for coal shipment on China's coastal sea routes declined to a new low since mid-April this year amid subdued shipping demand in the week ending June 7, with the composite index falling b

6 Infographic | Indonesia coal exports in Apr 2024 2024-06-11

Indonesia's coal exports rose 5.51% YoY yet declined 0.24% MoM to 45.99 Mt in Apr 2024, according to data from Statistics Indonesia.

7 Infographic | China Taiwan coal imports in May 2024 2024-06-11

Coal imports of China's Taiwan in May edged up 0.05% YoY and 1.56% MoM to 4.99 Mt, showed data from Taiwan customs.

8 Weekly: China's met coke market faces downside risks after price rises fall through 2024-06-11

China's metallurgical coke market faced downward pressure last week from falling feed coal prices and thin profit margins that led steel mills to reject the proposed coke price hike from several coke

9 1 dead, 2 missing in coal mine accident in Yunnan 2024-06-11

A coal and gas outburst accident in southwestern China's Yunnan province killed one person on June 7, leaving two others missing and three more injured, Xinhua News Agency reported on June 8.The accid

10 China thermal coal market in figures (Jun 11) 2024-06-11

China thermal coal market key figures in focus. The latest data for thermal coal prices, stocks, shipments in major production areas, transfer ports and most followed downstream sector data.