REG - Anglo American PLC BHP Group Limited - Statement re Revised Proposal from BHP

BHPAnnouncement

13/05/2024 14:45

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RNS Number : 2232O  Anglo American PLC  13 May 2024

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, DIRECTLY OR
INDIRECTLY, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE
A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION.

THIS ANNOUNCEMENT IS NOT AN ANNOUNCEMENT OF A FIRM INTENTION TO MAKE AN OFFER
UNDER RULE 2.7 OF THE CITY CODE ON TAKEOVERS AND MERGERS (THE "CODE"). THERE
CAN BE NO CERTAINTY THAT ANY FIRM OFFER WILL BE MADE.

13 May 2024

 

 

Anglo American plc ("Anglo American")
Registered office: 17 Charterhouse Street, London EC1N 6RA

Registered number: 3564138 (incorporated in England and Wales)

Legal Entity Identifier: 549300S9XF92D1X8ME43

 

Statement re Revised Proposal from BHP

 

 

The Board of Anglo American (the "Board") notes the announcement made by BHP
Group Limited ("BHP") and confirms that on 7 May 2024 it received a second
unsolicited, non-binding and highly conditional combination proposal from BHP
(the "Latest Proposal").

 

The structure of the Latest Proposal is unchanged from the proposal previously
rejected on 26 April 2024. This comprises an all-share offer for Anglo
American by BHP, with a requirement for Anglo American to complete two
separate demergers of its entire shareholdings in Anglo American Platinum
Limited and Kumba Iron Ore Limited to Anglo American shareholders. The
all-share offer and required demergers would be inter-conditional.

 

Under the terms of the Latest Proposal, for each Anglo American share owned,
Anglo American shareholders would receive:

-     0.8132 BHP shares; and

-     Ordinary shares in each of Anglo American Platinum Limited and of
Kumba Iron Ore Limited (distributed by Anglo American to its shareholders in
direct proportion to Anglo American shareholders' effective interest in Anglo
American Platinum Limited and Kumba Iron Ore Limited).

 

The Board has considered the Latest Proposal with its advisers and concluded
that it continues to significantly undervalue Anglo American and its future
prospects.

 

In addition, the Board has also taken into account the detailed feedback from
its extensive engagement with Anglo American's shareholders and stakeholders
since the approach from BHP became public on 24 April 2024.

 

Aside from significantly undervaluing Anglo American, the Latest Proposal
continues to contemplate a structure which the Board believes is highly
unattractive for Anglo American's shareholders, given the uncertainty and
complexity inherent, and significant execution risks.

 

The requirement to pursue two contemporaneous demergers creates significant
uncertainty, which falls disproportionately to Anglo American shareholders.

 

The Anglo American Platinum Limited and Kumba Iron Ore Limited shareholdings,
at current market value, are worth approximately $15bn and 34% of the proposed
total consideration. This is a substantial amount of stock to distribute and
reflects a majority of the shares of both Anglo American Platinum Limited and
Kumba Iron Ore Limited. This creates significant uncertainty as to the
delivered value as part of the proposal.

 

In addition, by requiring this as part of a takeover of Anglo American, it
would result in additional approvals related to these two demergers. The
timetable to obtain these additional approvals is expected to be lengthy. Some
of these approvals may result in potential conditions being attached to the
approvals, which could disproportionately impact Anglo American Platinum
Limited and Kumba Iron Ore Limited and are not addressed in the Latest
Proposal.

 

Accordingly, the Board of Anglo American has unanimously rejected the Latest
Proposal.

 

The Board is confident in Anglo American's standalone future prospects. Anglo
American has accelerated plans for delivery of its standalone strategy and
will provide a detailed investor update on 14 May 2024.

 

Stuart Chambers, Chairman of Anglo American, commented:

 

"The latest proposal from BHP again fails to recognise the value inherent in
Anglo American. Anglo American shareholders are well positioned to benefit
from increasing demand from future enabling products while the increasing
capital intensity to bring greenfield supply online makes proven assets with
world class resource endowments ever more attractive. The Anglo American team
is focused on delivering against its strategic priorities of operational
excellence, portfolio simplification and growth and is set to accelerate
delivery in order to unlock this inherent value.

 

The BHP proposal also continues to have a highly unattractive structure. This
leaves Anglo American, its shareholders and stakeholders disproportionately at
risk from the substantial uncertainty and execution risk created by the
proposed inter-conditional execution of two demergers and a takeover."

 

Anglo American shareholders are advised to take no action in relation to this
matter. A further announcement will be made as and when appropriate. There can
be no certainty that any firm offer will be made.

 

Under Rule 2.6(a) of the Takeover Code, BHP must by not later than 5.00 p.m.
on 22 May 2024, either announce a firm intention to make an offer for Anglo
American in accordance with Rule 2.7 of the Takeover Code or announce that it
does not intend to make an offer, in which case the announcement will be
treated as a statement to which Rule 2.8 of the Takeover Code applies. This
deadline will only be extended with the consent of the Takeover Panel in
accordance with Rule 2.6(c) of the Takeover Code.

 

This announcement is being made without the agreement or approval of BHP.

 

For further information, please contact:

 

 Anglo American

 Media                                         Investors
 UK                                            UK

 James Wyatt-Tilby                             Tyler Broda

 james.wyatt-tilby@angloamerican.com           tyler.broda@angloamerican.com

 Tel: +44 (0)20 7968 8759                      Tel: +44 (0)20 7968 1470

 Marcelo Esquivel                              Emma Waterworth

 marcelo.esquivel@angloamerican.com            emma.waterworth@angloamerican.com

 Tel: +44 (0)20 7968 8891                      Tel: +44 (0)20 7968 8574

 Rebecca Meeson-Frizelle                       Juliet Newth

 rebecca.meeson-frizelle@angloamerican.com     juliet.newth@angloamerican.com

 Tel: +44 (0)20 7968 1374                      Tel: +44 (0)20 7968 8830

 South Africa                                  Michelle Jarman

michelle.jarman@angloamerican.com
 Nevashnee Naicker

                                             Tel: +44 (0)20 7968 1494
 nevashnee.naicker@angloamerican.com

 Tel: +27 (0)11 638 3189

 Sibusiso Tshabalala

 sibusiso.tshabalala@angloamerican.com

 Tel: +27 (0)11 638 2175

 Centerview Partners UK LLP (Financial Adviser to Anglo American)

James Hartop            Tel: +44 (0) 20 7409 9700
 Edward Rowe
 Fiona McHardy

 

 Goldman Sachs International (Financial Adviser to Anglo American)

Mark Sorrell      Tel: +44 (0) 20 7774 1000
 David Hammond
 Bertie Whitehead

 

 Morgan Stanley & Co. International plc (Financial Adviser to Anglo
 American)

Simon Smith     Tel: +44 (0) 20 7425 8000
 Anthony Zammit
 Tom Perry

 

Goldman Sachs International (Financial Adviser to Anglo American)

 Mark Sorrell      Tel: +44 (0) 20 7774 1000
 David Hammond
 Bertie Whitehead

 

Morgan Stanley & Co. International plc (Financial Adviser to Anglo
American)

 Simon Smith     Tel: +44 (0) 20 7425 8000
 Anthony Zammit
 Tom Perry

 

Sources and Bases

The value of Anglo American Platinum Limited and Kumba Iron Ore Limited
shareholdings are based on share prices as at closing on 10 May 2024 and
GBP/USD and ZAR/GBP exchange rates as at 10 May 2024.

 

IMPORTANT NOTICES

 

Centerview Partners UK LLP ("Centerview"), which is authorised and regulated
in the United Kingdom by the Financial Conduct Authority, is acting
exclusively as financial adviser to Anglo American and no one else in
connection with the matters set out in this announcement and will not be
responsible to anyone other than Anglo American for providing the protections
afforded to its clients or for providing advice in relation to the contents of
this announcement or any other matters referred to in this announcement.
Neither Centerview nor any of its affiliates, nor any of Centerview's and such
affiliates' respective members, directors, officers, controlling persons or
employees owes or accepts any duty, liability or responsibility whatsoever
(whether direct or indirect, consequential, whether in contract, in tort, in
delict, under statute or otherwise) to any person who is not a client of
Centerview in connection with this announcement, any statement contained
herein or otherwise.

Goldman Sachs International, ("Goldman Sachs") which is authorised by the
Prudential Regulation Authority and regulated by the Financial Conduct
Authority and the Prudential Regulation Authority in the United Kingdom, is
acting exclusively for Anglo American and no one else in connection with the
matters referred to in this announcement and will not be responsible to anyone
other than Anglo American for providing the protections afforded to clients of
Goldman Sachs International, or for providing advice in relation to the
matters referred to in this announcement.

Morgan Stanley & Co. International plc ("Morgan Stanley") which is
authorised by the Prudential Regulation Authority and regulated by the
Financial Conduct Authority and the Prudential Regulation Authority in the UK
is acting as financial adviser to Anglo American and no one else in connection
with the matters set out in this announcement. In connection with such
matters, Morgan Stanley, its affiliates and their respective directors,
officers, employees and agents will not regard any other person as their
client, nor will they be responsible to any other person for providing the
protections afforded to their clients or for providing advice in relation to
the contents of this announcement or any other matter referred to herein.

 

General information

 

In accordance with Rule 26.1 of the Code, a copy of this announcement will be
available subject to certain restrictions relating to persons resident in
restricted jurisdictions on Anglo American's website at www.Anglo American.com
(http://www.angloamerican.com) by no later than 12 noon (London time) on the
business day following the date of this announcement. The content of the
website referred to in this announcement is not incorporated into and does not
form part of this announcement.

 

The release, publication or distribution of this announcement in jurisdictions
outside the United Kingdom may be restricted by law or regulation and
therefore persons into whose possession this announcement comes should inform
themselves about, and observe, such restrictions. Any failure to comply with
the restrictions may constitute a violation of the securities laws or
regulations of any such jurisdictions.

 

Disclosure requirements of the Code

 

Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of
any class of relevant securities of an offeree company or of any securities
exchange offeror (being any offeror other than an offeror in respect of which
it has been announced that its offer is, or is likely to be, solely in cash)
must make an Opening Position Disclosure following the commencement of the
offer period and, if later, following the announcement in which any securities
exchange offeror is first identified. An Opening Position Disclosure must
contain details of the person's interests and short positions in, and rights
to subscribe for, any relevant securities of each of (i) the offeree company
and (ii) any securities exchange offeror(s). An Opening Position Disclosure by
a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm
(London time) on the 10th business day following the commencement of the offer
period and, if appropriate, by no later than 3.30 pm (London time) on the 10th
business day following the announcement in which any securities exchange
offeror is first identified. Relevant persons who deal in the relevant
securities of the offeree company or of a securities exchange offeror prior to
the deadline for making an Opening Position Disclosure must instead make a
Dealing Disclosure.

 

Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1%
or more of any class of relevant securities of the offeree company or of any
securities exchange offeror must make a Dealing Disclosure if the person deals
in any relevant securities of the offeree company or of any securities
exchange offeror. A Dealing Disclosure must contain details of the dealing
concerned and of the person's interests and short positions in, and rights to
subscribe for, any relevant securities of each of (i) the offeree company and
(ii) any securities exchange offeror(s), save to the extent that these details
have previously been disclosed under Rule 8. A Dealing Disclosure by a person
to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London
time) on the business day following the date of the relevant dealing.

 

If two or more persons act together pursuant to an agreement or understanding,
whether formal or informal, to acquire or control an interest in relevant
securities of an offeree company or a securities exchange offeror, they will
be deemed to be a single person for the purpose of Rule 8.3.

 

Opening Position Disclosures must also be made by the offeree company and by
any offeror and Dealing Disclosures must also be made by the offeree company,
by any offeror and by any persons acting in concert with any of them (see
Rules 8.1, 8.2 and 8.4).

 

Details of the offeree and offeror companies in respect of whose relevant
securities Opening Position Disclosures and Dealing Disclosures must be made
can be found in the Disclosure Table on the Takeover Panel's website at
www.thetakeoverpanel.org.uk, including details of the number of relevant
securities in issue, when the offer period commenced and when any offeror was
first identified. You should contact the Panel's Market Surveillance Unit on
+44 (0) 20 7638 0129 if you are in any doubt as to whether you are required to
make an Opening Position Disclosure or a Dealing Disclosure.

 

 

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