Anglo-American rejects BHP’s takeover extension request

Anglo-American dismissed BHP Group’s final request for an extension to discuss a $49 billion takeover bid on Wednesday, deeming it overly intricate and likely bringing an end to BHP’s five-week pursuit of its larger competitor, Reuters reported.

Initially, Anglo-American had extended BHP’s deadline by a week until 1600 GMT on Wednesday from the original May 22 cutoff, following the rejection of BHP’s third takeover proposal due to perceived execution challenges.

BHP now faces the choice of either making a definitive offer by the deadline or withdrawing from the pursuit altogether.

On Wednesday, BHP’s shares remained steady at A$45.08, while Anglo’s dropped 0.7 per cent to 25.39 pounds by 0915 GMT.

Anglo, listed in London, had consented to engage in discussions with BHP in an attempt to resolve concerns regarding the proposed deal’s structure, particularly the requirement for Anglo to separate its South African platinum and iron ore units prior to the takeover.

BHP, in an earlier communication, cited the need for additional time to address Anglo’s concerns while pledging measures to mitigate regulatory risks in South Africa, including ensuring job security for South African employees and covering the costs associated with anticipated increases in South African employee ownership resulting from any demerger.

Anglo’s statement highlighted BHP’s consistent stance on the perceived insignificance of the risks associated with its complex structure while simultaneously expressing unwillingness to alter the proposed structure to assume these risks.