BHP: Increased and closingoffer ratio for Anglo American

Issued on behalf of BHP Neighborhood Ltd

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

As said in Anglo American’s announcement of 24 April 2024, BHP was once required to either state a firm arrangement to gain an offer for Anglo American or state that it does not intend to gain an offer by 5.00 p.m. (BST) on 22 Might well well perchance 2024. As role out in the Extension Announcement, the Board of Anglo American requested an extension of the closing date under 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 Might well well perchance 2024 it submitted an increased and closing offer ratio to the Board of Directors of Anglo American as segment of its proposal for a doable combination with Anglo American to be effected by arrangement of a arrangement of diagram. In placing forward the Final¹Provide Ratio (as outlined below), BHP has been guided by its capital allocation framework and its word of the elementary note of Anglo American and BHP.

The revised proposal follows BHP’s preliminary proposal which was once submitted to the Board of Anglo on 16 April 2024 (Preliminary Proposal) and BHP’s 2nd proposal which was once submitted to the Board of Anglo on 7 Might well well perchance 2024 (2nd Proposal).

The transaction structure of the revised proposal remains the equal as BHP’s outdated proposals and comprises an all-share offer for Anglo American self-discipline to the official-rata distribution by Anglo American of its whole shareholdings in Anglo American Platinum Ltd (English Platinum) and Kumba Iron Ore Ltd (At home) to Anglo American shareholders without extend sooner than completion of the arrangement of diagram. For the rationale that submission of the revised proposal, now we had been taking part with Anglo American and its advisors to reduction mitigate the troubles associated with the implementation of this structure that led to the rejection of the revised proposal. We bear made progress on these issues over the route of the engagement to this level, and we are hopeful that resolution will be reached in the next seven days.

Below the extended closing date, BHP have to either state a firm arrangement to gain an offer for Anglo American in conserving with Rule 2.7 of the UK Code or state that it does not intend to gain an offer for Anglo American, whereby case the announcement will be treated as an announcement to which Rule 2.8 of the UK Code applies, by no later than 5.00 p.m. (BST) on 29 Might well well perchance 2024 (theRevised Gash-off date). The Revised Gash-off date may perchance perchance perchance moreover honest be extended with the consent of the Panel in conserving with Rule 2.6(c) of the UK Code.

Building of the proposal

Below the terms of the revised proposal, in type shareholders of Anglo American would rep:

0.8860 BHP shares for each in type share they maintain in Anglo American (BHP Fragment Consideration), which represents Anglo American shareholders owning, in aggregate, approximately 17.8% of the mixed BHP and Anglo American neighborhood on completion of the functionality combination (theFinal¹Provide an Account); and
in type shares in Anglo Platinum and Kumba (which may perchance perchance perchance be dispensed by Anglo American to its shareholders in enlighten share to each shareholder’s effective ardour in Anglo Platinum and Kumba).

The Final Provide Ratio represents a total note of £31.11 per Anglo American share primarily based on the closing share costs of BHP as at 22 Might well well perchance 2024 and Anglo Platinum and Kumba as at 21 Might well well perchance 2024.

The Final Provide Ratio may perchance perchance not be increased, apart from that BHP reserves the explicit to develop and/or in any other case pork up the Final Provide Ratio if (i) there is an announcement on or after the date of this announcement of an offer or possible offer (along side a partial offer) for Anglo American by a 3rd birthday party offeror(s) or doable offeror(s) (whether or not acknowledged or not), (ii) the Board of Anglo American proclaims that it recommends or is minded to counsel an offer on higher terms than the Final Provide Ratio or (iii) the Takeover Panel in any other case offers its consent.

The mixed neighborhood would bear a number one portfolio of immense, low-payment, long-life Tier 1 sources all in favour of iron ore and metallurgical coal and future going through commodities, along side potash and copper. Anglo American’s diverse excessive quality agencies, along side its diamond enterprise, would be self-discipline to a strategic review put up completion.

BHP is committed to a combination that leverages the only of both BHP and Anglo American and intends to present Anglo American up to two positions on the Board of the mixed entity.

BHP will work carefully and constructively with competition regulators and present the strategies they have to evaluate the functionality transaction. BHP is confident that it may perchance perchance develop all required regulatory approvals and consummate a transaction that advantages customers globally.

The revised proposal is non-binding and self-discipline to outmoded prerequisites along side completion of due diligence to the satisfaction of BHP. Anglo American has been supplied reciprocal due diligence on BHP.

Mike Henry, BHP Chief Executive Officer said:

“BHP has recommend a closing offer ratio of 0.8860BHP shares for each Anglo American share. That is a first-rate extend from our first proposal and would present Anglo American shareholders with17.8% of a mixed BHP and Anglo American.

The revised proposal is underpinned by BHP’s disciplined arrangement to mergers and acquisition and our level of interest on handing over very long time period elementary note.

BHP’s revised proposal will offer rapid note for Anglo American shareholders and permit them to gain pleasure from the long-time period note generation of the mixed neighborhood.

BHP appears to be like forward to taking part with the Board of Anglo American to stumble on this strange and compelling opportunity to compile two extremely complementary, world class agencies.”

Price of the proposal

The terms of the proposal represent a total note, primarily based on space share costs and FX charges⁶as at 22 Might well well perchance 2024 for BHP and 21 Might well well perchance 2024 for Anglo Platinum and Kumba, of approximately £31.11 per Anglo American in type share along side £5.40 in Anglo Platinum shares, £4.23 in Kumba shares and £21.48 per share for Anglo American’s unlisted sources, valuing Anglo American’s share capital at approximately £38.6 billion, and implying a:

47% top class on the aggregate £ note per Anglo American in type share over the undisturbed Anglo American share note (£21.11 as at 23 April 2024, being the last buying and selling day sooner than the press speculation referring to the Preliminary Proposal);
top class on the undisturbed market note of Anglo American’s unlisted sources of approximately 67% (in £ per share, as at 23 April 2024);
top class on the undisturbed market note of Anglo American’s unlisted sources³of approximately 127% primarily based on the quantity weighted moderate closing note of Anglo American’s shares (adjusted for the attributable volume weighted moderate closing costs of Anglo Platinum and Kumba) in the 90 buying and selling days sooner than and along side 23 April 2024; and
56% top class to the dealer median web asset note⁴of Anglo American’s unlisted sources.

The revised proposal represents an extend in the distance aggregate £ note per Anglo American in type share over the 2nd Proposal (as offered on 13 Might well well perchance 2024) of 11.3%. The terms of the revised proposal represent an extend over the Preliminary Proposal:

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

The extend in the Final Provide Ratio shows extra note from Anglo American’s restructuring proposal and worth plans. BHP believes that the Final Provide Ratio represents a compelling opportunity for extremely long time period elementary note-creation for both Anglo American and BHP shareholders.

UK Takeover Code

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

to gain an offer on much less beneficial terms:
- 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 3rd birthday party proclaims a firm arrangement to gain an offer for Anglo American at a decrease note and/or on much less beneficial terms than contemplated under the terms of this proposed offer; or
- if the option of Anglo American shares to be acquired involves any shares held by Tarl Funding Holdings Minute, Epoch Funding Holdings Minute, and/or Epoch Two Funding Holdings (collectively the “Tarl and Epoch shares”), or any of the Tarl and Epoch shares consequence in the self-discipline of extra BHP shares as consideration or in connection with the offer; and/or
to place in power the proposed offer through a takeover offer rather then a arrangement of diagram.

If Anglo American proclaims, proclaims, makes, or will pay any dividend or any diverse distribution or return of note to shareholders, Demonstrate 4 on Rule 2.5 of the Code applies.

This announcement does not amount to a firm arrangement to gain an offer and there may perchance perchance perchance moreover honest be no drag wager that an offer will be made. There shouldn’t be any such thing as a drag wager that any make of settlement or transaction will be reached or concluded.

This announcement is being made by BHP with out prior settlement or approval of Anglo American.

Read moreover:

BHP confirms that on 20 Might well well perchance 2024 it submitted an increased and closing offer ratio to the Board of Directors of Anglo American
🔒 FT: Eskom chair Nyati says the utility is “fastened”, loadshedding over
LGIM approves Anglo American’s break-up opinion amid BHP takeover closing date

Footnotes

1. The Final Provide Ratio may perchance perchance not be increased, apart from that BHP reserves the explicit to develop and/or in any other case pork up the Final Provide Ratio if (i) there is an announcement on or after the date of this announcement of an offer or possible offer (along side a partial offer) for Anglo American by a 3rd birthday party offeror(s) or doable offeror(s) (whether or not acknowledged or not), (ii) the Board of Anglo American proclaims that it recommends or is minded to counsel an offer on higher terms than the Final Provide Ratio or (iii) the Takeover Panel in any other case offers its consent.
2. This release was once constituted of doorways of the hours of operation of the ASX markets announcement assign of job.
3. Anglo American’s unlisted sources comprises the entirety of the worth implied for Anglo American’s sources and liabilities rather then its shareholdings in Anglo Platinum and Kumba primarily based on Anglo American’s closing note much less the closing costs of Anglo Platinum and Kumba on 23 April 2024, being the last buying and selling day sooner than the press speculation referring to the Preliminary Proposal.
4. Safe asset note is primarily based upon a median of the six brokers which present SOTP, along side Anglo Platinum and Kumba, alongside most fresh reported Anglo Platinum and Kumba web money balances as of 31 December 2023.
5. In accordance with 0.8860 BHP shares for each in type share. The option of fully diluted Anglo American shares assumed excludes shares held by Tarl Funding Holdings Minute, Epoch Funding Holdings Minute, and Epoch Two Funding Holdings. These shares total 112,300,129 as per the Rule 2.9 announcement by Anglo American dated 25 April 2024.
6. In accordance with space FX charges as at 21 Might well well perchance 2024 (AUD:GBP 0.5243; ZAR:GBP 0.0435).