BHP has officially withdrawn its latest attempt to acquire Anglo American, following another unsuccessful pursuit to disrupt the mining company’s imminent merger with Canadian firm Teck Resources. This latest development comes after BHP rekindled its interest last week, more than a year after abandoning a £39 billion bid for the FTSE 100-listed mining giant.
The timing of BHP’s renewed interest coincides with an approaching vote by shareholders of Anglo and Teck, set for December 9, regarding their proposed $53 billion merger. In a Monday announcement, BHP acknowledged that it had engaged in preliminary discussions with Anglo but clarified that it would no longer be considering a merger and would instead focus on its own strategic direction. The company emphasized its belief in the strategic benefits a merger would have presented, stating optimism about its current organic growth strategy.
Under City regulations governing takeovers, BHP will be unable to make another bid for Anglo for a period of six months, unless significant circumstances change. This constraint follows a series of prior unsuccessful attempts by BHP to negotiate a merger with Anglo last year, culminating in a public declaration in October that the company had moved on from pursuing a deal.
Anglo American’s significant copper reserves have drawn considerable interest from potential investors, given copper’s crucial role in the development of low-carbon technologies such as solar panels and electric vehicles. Shares of Anglo have surged by over two-thirds since the beginning of 2024 and have recorded a nearly 25% increase since BHP’s initial offer was tabled last May.
The prior bid faced strong resistance from Anglo’s board, which described BHP’s proposal as “highly complex and unattractive,” particularly given conditions attached to the prospective sale of Anglo’s South African operations.
The proposed merger between Teck and Anglo American still awaits regulatory approvals from various jurisdictions, including China, the United States, and Canada. Industry analysts, including Kathleen Brooks from broker XTB, suggest that while the anticipated merger could spur further activity in the mining sector, BHP’s retreat may also reflect broader economic concerns. Brooks indicated that in times of uncertainty regarding the global economy or potential market downturns, the likelihood of any new takeover attempts within the resources sector might diminish significantly.
