BHP: Elevated and finalprovide ratio for Anglo American

Issued on behalf of BHP Community Ltd

BHP Community Ltd (BHP) notes the announcement by Anglo American plc (Anglo American) in the case of the extension of the closing date for a BHP proposal (theExtension Announcement).

As acknowledged in Anglo American’s announcement of 24 April 2024, BHP became once required to either instruct a firm device to invent an provide for Anglo American or instruct that it would not intend to invent an provide by 5.00 p.m. (BST) on 22 Can also 2024. As space out within the Extension Announcement, the Board of Anglo American requested an extension of the closing date beneath Rule 2.6(c) of the UK Code with the consent of the UK Panel on Takeovers and Mergers (theTakeover Panel).

BHP confirms that on 20 Can also 2024 it submitted an increased and final provide ratio to the Board of Directors of Anglo American as phase of its proposal for a seemingly combination with Anglo American to be effected by device of a plan of affiliation. In asserting the Final¹Offer Ratio (as defined below), BHP has been guided by its capital allocation framework and its look of the elementary trace of Anglo American and BHP.

The revised proposal follows BHP’s initial proposal which became once submitted to the Board of Anglo on 16 April 2024 (Initial Proposal) and BHP’s second proposal which became once submitted to the Board of Anglo on 7 Can also 2024 (Second Proposal).

The transaction structure of the revised proposal stays the identical as BHP’s previous proposals and comprises an all-share provide for Anglo American field to the educated-rata distribution by Anglo American of its entire shareholdings in Anglo American Platinum Ltd (English Platinum) and Kumba Iron Ore Ltd (At home) to Anglo American shareholders straight away sooner than completion of the plan of affiliation. For the reason that submission of the revised proposal, we had been enticing with Anglo American and its advisors to relief mitigate the worries associated to the implementation of this structure that resulted in the rejection of the revised proposal. We now accept as true with got made growth on these issues over the course of the engagement to this level, and we are hopeful that resolution will be reached within the following seven days.

Below the prolonged closing date, BHP should always either instruct a firm device to invent an provide for Anglo American in step with Rule 2.7 of the UK Code or instruct that it would not intend to invent an provide for Anglo American, in which case the announcement will be treated as a assertion to which Rule 2.8 of the UK Code applies, by no later than 5.00 p.m. (BST) on 29 Can also 2024 (theRevised Closing date). The Revised Closing date can even be prolonged with the consent of the Panel in step with Rule 2.6(c) of the UK Code.

Construction of the proposal

Below the phrases of the revised proposal, frequent shareholders of Anglo American would find:

0.8860 BHP shares for every frequent share they comprise in Anglo American (BHP Fragment Consideration), which represents Anglo American shareholders proudly owning, in combination, approximately 17.8% of the mixed BHP and Anglo American community on completion of the seemingly combination (theFinal¹Offer Ratio); and
frequent shares in Anglo Platinum and Kumba (which will seemingly be distributed by Anglo American to its shareholders in declare percentage to every shareholder’s efficient ardour in Anglo Platinum and Kumba).

The Final Offer Ratio represents a entire trace of £31.11 per Anglo American share in step with the closing share prices of BHP as at 22 Can also 2024 and Anglo Platinum and Kumba as at 21 Can also 2024.

The Final Offer Ratio may perchance perchance not be increased, with the exception of that BHP reserves the factual to invent bigger and/or in every other case purple meat up the Final Offer Ratio if (i) there is an announcement on or after the date of this announcement of an provide or seemingly provide (including a partial provide) for Anglo American by a Third birthday party offeror(s) or seemingly offeror(s) (whether or not identified or not), (ii) the Board of Anglo American declares that it recommends or is minded to recommend an provide on higher phrases than the Final Offer Ratio or (iii) the Takeover Panel in every other case affords its consent.

The mixed community would accept as true with a leading portfolio of huge, low-fee, prolonged-existence Tier 1 sources provocative on iron ore and metallurgical coal and future facing commodities, including potash and copper. Anglo American’s other high quality companies, including its diamond alternate, would be field to a strategic review post completion.

BHP is dedicated to a mix that leverages the higher of every BHP and Anglo American and intends to offer Anglo American as much as 2 positions on the Board of the mixed entity.

BHP will work closely and constructively with opponents regulators and provide the solutions they want to assess the seemingly transaction. BHP is confident that it is going to manufacture all required regulatory approvals and consummate a transaction that advantages potentialities globally.

The revised proposal is non-binding and field to former instances including completion of due diligence to the pleasure of BHP. Anglo American has been supplied reciprocal due diligence on BHP.

Mike Henry, BHP Chief Executive Officer talked about:

“BHP has put forward a final provide ratio of 0.8860BHP shares for every Anglo American share. Right here’s a necessary invent bigger from our first proposal and would offer Anglo American shareholders with17.8% of a mixed BHP and Anglo American.

The revised proposal is underpinned by BHP’s disciplined device to mergers and acquisition and our level of curiosity on delivering very prolonged time length elementary trace.

BHP’s revised proposal will provide instantaneous trace for Anglo American shareholders and allow them to accept as true with the benefit of the prolonged-time length trace generation of the mixed community.

BHP appears to be like to be like forward to enticing with the Board of Anglo American to discover this distinctive and compelling replacement to assemble two highly complementary, world class companies.”

Tag of the proposal

The phrases of the proposal signify a entire trace, in step with web philosophize online share prices and FX rates⁶as at 22 Can also 2024 for BHP and 21 Can also 2024 for Anglo Platinum and Kumba, of approximately £31.11 per Anglo American frequent share including £5.40 in Anglo Platinum shares, £4.23 in Kumba shares and £21.Forty eight per share for Anglo American’s unlisted sources, valuing Anglo American’s share capital at approximately £38.6 billion, and implying a:

47% top rate on the combination £ trace per Anglo American frequent share over the undisturbed Anglo American share trace (£21.11 as at 23 April 2024, being the remaining buying and selling day sooner than the click speculation regarding the Initial Proposal);
top rate on the undisturbed market trace of Anglo American’s unlisted sources of approximately 67% (in £ per share, as at 23 April 2024);
top rate on the undisturbed market trace of Anglo American’s unlisted sources³of approximately 127% in step with the volume weighted reasonable closing trace of Anglo American’s shares (adjusted for the attributable volume weighted reasonable closing prices of Anglo Platinum and Kumba) within the 90 buying and selling days earlier than and including 23 April 2024; and
56% top rate to the broker median find asset trace⁴of Anglo American’s unlisted sources.

The revised proposal represents an invent bigger within the web site online combination £ trace per Anglo American frequent share over the Second Proposal (as announced on 13 Can also 2024) of 11.3%. The phrases of the revised proposal signify an invent bigger over the Initial Proposal:

of 24.8% within the merger change ratio⁵and BHP Fragment Consideration; and
20.4% in Anglo American shareholders’ combination ownership within the enlarged community (i.e. rising from c. 14.8% to c.17.8%).

The invent bigger within the Final Offer Ratio displays extra trace from Anglo American’s restructuring proposal and price plans. BHP believes that the Final Offer Ratio represents a compelling replacement for very prolonged time length elementary trace-creation for every Anglo American and BHP shareholders.

UK Takeover Code

Pursuant to Rule 2.5 of the Code, BHP reserves the factual:

to invent an provide on less favourable phrases:
- with the settlement or consent of the Anglo American Board; or
- following the announcement by Anglo American of a Rule 9 waiver pursuant to the Code; or
- if a Third birthday party declares a firm device to invent an provide for Anglo American at a decrease trace and/or on less favourable phrases than contemplated beneath the phrases of this proposed provide; or
- if the chance of Anglo American shares to be obtained entails any shares held by Tarl Investment Holdings Puny, Epoch Investment Holdings Puny, and/or Epoch Two Investment Holdings (collectively the “Tarl and Epoch shares”), or any of the Tarl and Epoch shares consequence within the scenario of additional BHP shares as consideration or in reference to the provide; and/or
to put into effect the proposed provide by device of a takeover provide versus a plan of affiliation.

If Anglo American declares, declares, makes, or can pay any dividend or every other distribution or return of trace to shareholders, Demonstrate 4 on Rule 2.5 of the Code applies.

This announcement would not quantity to a firm device to invent an provide and there can even be no certain bet that an provide will be made. There isn’t any certain bet that any manufacture of settlement or transaction will be reached or concluded.

This announcement is being made by BHP without prior settlement or approval of Anglo American.

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Footnotes

1. The Final Offer Ratio may perchance perchance not be increased, with the exception of that BHP reserves the factual to invent bigger and/or in every other case purple meat up the Final Offer Ratio if (i) there is an announcement on or after the date of this announcement of an provide or seemingly provide (including a partial provide) for Anglo American by a Third birthday party offeror(s) or seemingly offeror(s) (whether or not identified or not), (ii) the Board of Anglo American declares that it recommends or is minded to recommend an provide on higher phrases than the Final Offer Ratio or (iii) the Takeover Panel in every other case affords its consent.
2. This open became once made outside of the hours of operation of the ASX markets announcement office.
3. Anglo American’s unlisted sources comprises the entire lot of the price implied for Anglo American’s sources and liabilities except for its shareholdings in Anglo Platinum and Kumba in step with Anglo American’s closing trace less the closing prices of Anglo Platinum and Kumba on 23 April 2024, being the remaining buying and selling day earlier than the click speculation regarding the Initial Proposal.
4. Accumulate asset trace is ba sically based upon a median of the six brokers which roar SOTP, including Anglo Platinum and Kumba, alongside most fresh reported Anglo Platinum and Kumba find money balances as of 31 December 2023.
5. In step with 0.8860 BHP shares for every frequent share. The likelihood of fully diluted Anglo American shares assumed excludes shares held by Tarl Investment Holdings Puny, Epoch Investment Holdings Puny, and Epoch Two Investment Holdings. These shares entire 112,300,129 as per the Rule 2.9 announcement by Anglo American dated 25 April 2024.
6. In step with web philosophize online FX rates as at 21 Can also 2024 (AUD:GBP 0.5243; ZAR:GBP 0.0435).