JPMorgan analysts released a report stating that BHP needs to increase its latest offer by approximately 30% to fairly reflect the value of the British mining company Anglo American. In other words, BHP needs to spend $50 billion to successfully acquire Anglo American.
BHP previously launched a bid for Anglo American, but both offers were rejected. The company’s bids were £25.08 per share (totaling £31.1 billion, or $39.1 billion) and £27.53 per share (totaling £34 billion, or $42.7 billion). Anglo American claims that the latest offer still significantly undervalues its worth.
Both of BHP’s bids were all-stock acquisitions. The company also set a prerequisite that before the formal acquisition, Anglo American must spin off all its shares in Anglo American Platinum Ltd. and Kumba Iron Ore Ltd. to Anglo American’s shareholders.
According to UK takeover rules, BHP must make a new offer by May 22, otherwise, it will be considered to have abandoned the acquisition.
JPMorgan analysts stated that after reassessing the value of Anglo American’s copper assets, they raised the company’s target stock price to £27.75 per share. They also mentioned that Anglo American’s current stock price is at a discount of up to 13.6% compared to the implied value of BHP’s offer, indicating that the market perceives a low likelihood of BHP successfully acquiring the company.
JPMorgan estimates that the fair acquisition price for Anglo American is £32 per share, with a total value of approximately £39.5 billion ($50 billion).
BHP’s primary motive for bidding for Anglo American is to acquire its copper assets in South America. Currently, global mining companies generally underinvest in new copper mines and prefer to increase their market share through acquisitions.
If BHP successfully acquires Anglo American, it will mark the largest merger in the history of the mining industry and make BHP the world’s largest copper producer, holding about 10% of the market share.
[Source – 上海有色网] 摩根大通:必和必拓需要斥资500亿美元 才能成功收购英美资源 https://news.smm.cn/news/102760691