BHP, the world’s largest mining group, has unveiled plans for a groundbreaking €36 billion bid to merge with its beleaguered rival Anglo American, aiming to bolster copper production amidst soaring global demand.
The proposed merger, valued at £31 billion, comes in the wake of Anglo American’s significant profit downturn, with a staggering 94% decrease noted last year. BHP’s offer to Anglo’s stockholders stands at £25.08 per share, signaling a substantial bid to consolidate their positions in the mining industry.
The potential merger heralds one of the largest mining deals in recent memory and could position BHP as the leading global copper producer. With Anglo’s extensive mining operations spanning South Africa, Chile, Australia, and Peru, the combined entity would command approximately 10% of the world’s copper supply, exceeding 2 million tonnes.
The strategic significance of copper, particularly in the context of the green energy transition, underscores the timeliness of the proposed merger. As global demand for the metal continues to surge, fueled by initiatives for sustainable energy, the merger aims to capitalize on this burgeoning market.
While Anglo American acknowledges BHP’s proposal, it remains contingent on various factors, with the group emphasizing the uncertain nature of any potential offer. Under UK takeover regulations, BHP has until May 22 to present a definitive proposal, setting the stage for further developments in the coming weeks.
If realized, the merger would mark BHP’s second major acquisition in recent years, following its acquisition of copper miner Oz Minerals in 2023. Analysts anticipate that such consolidation efforts within the mining sector could catalyze additional mergers as companies seek to optimize their portfolios and capitalize on opportunities presented by the transition to a net-zero economy.
The announcement has already spurred significant market activity, with Anglo shares experiencing a notable surge of 13.63% in daily trading, underscoring the potential impact of the proposed merger on industry dynamics and shareholder value.
