BHP Group Limited (BHP) has sent a group of executives, including its CEO, to South Africa for talks with domestic investors, regulators and the government to further the proposed takeover of Anglo American PLC (AAL.L).
BHP Executives In South Africa For Talks About Anglo American Takeover
Euronews reported on 25 April 2024 that Anglo American, a UK-based mining enterprise, had rejected BHP’s €36bn takeover bid and indicated that it was not in the interest of its investors. BHP is the world’s largest miner and Anglo American’s steepest competition.
According to a Bloomberg report on Thursday, 2 May 2024, the deployed executives had already started discussions with principal investors to detail the €36bn offer. Despite its prominence in the global mining arena, BHP may find itself at a disadvantage in South Africa as Anglo American was founded in this developing country.
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The BHP takeover proposal, which reportedly took the South African government by surprise, outlined a scheme to spin off the platinum and iron ore units listed in Johannesburg before acquiring the remaining holdings. Bloomberg reported that the “Anglo shorn of Kumba Iron Ore Ltd. and Anglo American Platinum Ltd. comes at a difficult time for the government”.
South Africa will hold a national election on 29 May 2024. The ruling party’s opposition has already used the BHP bid as part of its scathing criticism of the ruling government’s economic practices in light of skyrocketing unemployment rates and crumbling infrastructure. The company stated:
The proposed structure does not reflect a view of South Africa as an investment destination and is based on portfolio and commodity considerations.
The country’s state pension fund owns 8.4% of Anglo American shares.
