BHP Spurned in $5.8 Billion Bid to Add Copper and Nickel
BHP Group was rejected in a takeover approach for OZ Minerals Ltd. as the world’s top miner seeks to add copper and nickel assets vital in the shift to electric transport and clean energy.
(Bloomberg) — BHP Group was rejected in a takeover approach for OZ Minerals Ltd. as the world’s top miner seeks to add copper and nickel assets vital in the shift to electric transport and clean energy.
Melbourne-based BHP’s offer of A$25 per share “significantly undervalues” the Adelaide-based producer and wouldn’t adequately compensate shareholders, OZ Minerals said Monday in a statement. The proposal valued the target at about A$8.4 billion ($5.8 billion), according to Bloomberg calculations.
“We have a unique set of copper and nickel assets, all with strong long-term growth potential in quality locations,” OZ Minerals Chief Executive Officer Andrew Cole said in the statement. “We are mining minerals that are in strong demand particularly for the global electrification and decarbonization thematic.”
BHP, which this year hived off its oil and gas assets, is seeking to add more growth in commodities tied to trends including low-emissions transport and clean energy, particularly copper used across the energy sector and nickel needed for lithium-ion batteries.
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The proposal “represents compelling value and certainty for OZ Minerals shareholders,” BHP’s CEO Mike Henry said in a statement, and the producer is disappointed the target’s board “has indicated that it is not willing to entertain our compelling offer or provide us with access to due diligence in relation to our proposal.”
The bid represents a 32% premium to OZ Minerals’ closing price on Friday of A$18.92. BHP has accumulated an interest in the Australian miner of less than 5%, OZ Minerals said.
OZ Minerals operates copper mines in South Australia, where BHP has its giant Olympic Dam operation, has nickel developments in Western Australia and other assets and projects in Brazil. The firm has appointed Macquarie Capital and Greenhill & Co. as financial advisers, and Gilbert + Tobin as legal adviser in relation to BHP’s approach.
(Updates to add BHP comment in fifth paragraph.)