Australia’s BHP Group has until May 29, 2024, to make a binding offer after Anglo American rejected its third “unsolicited” and “highly conditional” takeover proposal on May 22.

The latest proposal, which values Anglo American at £38.6 billion (approximately US$49.14 billion) based on spot share prices as of May 21 and 22, 2024, includes the same “highly complex structure” as the ones previously declined by Anglo American on April 26 and May 13, respectively. 

This involves 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 Ltd and Kumba Iron Ore Ltd to Anglo American’s shareholders. The all-share offer and required demergers would be inter-conditional.

Anglo American said it remains seriously concerned about the structure, given that it is likely to result in material completion risk and value impact that disproportionately falls on Anglo American’s shareholders.

To allow further engagement with BHP on mitigating risks, Anglo American is extending its PUSU (put up or shut up) deadline where BHP is required to announce its firm intention to make an offer for Anglo American or to walk away, no later than May 29, 2024. 

Stuart Chambers, chairman of Anglo American, said, “The board is confident in Anglo American’s standalone future prospects and believes that Anglo American has set out a clear pathway and timeframe to deliver the acceleration of its strategy to unlock significant and undiluted value for Anglo American’s shareholders.”

He added that the board had considered BHP’s latest proposal carefully and concluded it does not meet expectations of value delivered to Anglo American’s shareholders. 

Anglo American earlier announced that it will divest or demerge its diamond unit - De Beers Group - as part of its strategy to accelerate growth. De Beers Group CEO Al Cook, meanwhile, expressed confidence in the future of the diamond business, citing the ongoing recovery in rough diamond demand and the positive outlook for the sector. 

Anglo American's announcement to sell De Beers opens up new possibilities under new ownership, he added. "But some things will not change. We will continue to deliver value for all our stakeholders, including our partners in Botswana, South Africa, Namibia, Canada, Angola and other countries,” continued Cook.