Mining giant Anglo American rejected a request by Australian rival BHP to extend talks on a $49 billion takeover offer beyond a looming Wednesday deadline, possibly ending a bid to create a copper titan.
Anglo American rejected a third offer from BHP last week, worth £38.6 billion, but agreed to keep talks alive for seven more days.
With the 1600 GMT deadline looming for BHP to make a firm offer or abandon the bid, Anglo American said its board unanimously concluded that there was “no basis for a further extension”.
The British group said its rival had not addressed “fundamental concerns” over the bid structure and value.
The offer “includes the same highly complex and unattractive structure”, Anglo American said.
A core part of BHP’s plan is splitting off Anglo’s platinum holdings in South Africa, a politically sensitive move that stirred government opposition ahead of the country’s general election Wednesday.
South Africa’s state investment vehicle wields significant influence over the deal as one of the largest shareholders in Anglo American.
With the deadline approaching, BHP — which is listed in London and Sydney — made a last-ditch attempt Wednesday to mollify these concerns and keep its bid alive.
“BHP believes that its proposal will contribute to South Africa and allow the benefits of South African mining to be shared with more South African stakeholders,” the company had said in a statement to the Australian stock exchange.
“BHP believes a further extension of the deadline is required to allow for further engagement on its proposal,” it added.
This included a commitment to maintain staffing levels at Anglo’s Johannesburg office for “at least three years”, continuing Anglo’s charitable commitments in the country as well as a creating “Mining Centre of Excellence” to support research and development.
Crucial copper
Any deal between two of the world’s largest resources companies would fundamentally reshape the sector, with far-reaching consequences for commodities markets and the global energy transition.
BHP’s interest is largely stoked by its hunger to secure a reliable copper supply.
Anglo American’s South American copper holdings include four of the largest copper mines in the world.
An electrical conductor used in wiring, the metal is seen as a bedrock of emerging clean-energy industries — a crucial component in the manufacture of solar panels, electric vehicles and rechargeable batteries.
Copper prices have increased about 400 percent in the past quarter of a century, and broke US$10,000 a tonne in April for the first time in two years.
The boom has already prompted a wave of investment, with BHP snapping up Australian copper producer OZ Minerals for more than US$6 billion last year.