A multinational mining company is prepared to pay big money to seize control of a “modern” competitor.
BHP recently made an $8.3 billion takeover offer for OZ Minerals.
The proposed deal represents a 32 per cent premium on the target entity’s closing price on August 5, and involves purchasing all issued shares for $25 each via a scheme of arrangement. However, this is subject to satisfactory due diligence, entry into a scheme implementation agreement, unanimous board recommendation and majority shareholder approval.
“Our proposal represents compelling value and certainty for OZ Minerals shareholders in the face of a deteriorating external environment and increased … operational and growth related funding challenges,” BHP CEO Mike Henry said in a public statement.
However, OZ Minerals’ board rejected the “unsolicited” and “highly opportunistic” bid for inadequately reflecting:
- West Musgrave, Carrapateena Block Cave, Prominent Hill Extension and other growth projects
- decarbonisation plans to meet net-zero targets and scopes one and two operational emissions by 2030
- strong long-term commodity outlooks due to geological scarcity, global electrification and accelerating decarbonisation.
“We are mining minerals that are in strong demand particularly for the global electrification and decarbonisation thematic, and we have a long-life resource and reserve base. We do not consider the proposal from BHP sufficiently recognises these attributes,” OZ Minerals managing director and CEO Andrew Cole said in a public statement.
BHP fired back that it was “disappointed” to learn its competitor was unwilling to make a quick sale.
“[OZ Minerals] has indicated that it is not willing to entertain our compelling offer, or provide us with access to due diligence in relation to our proposal,” Henry said.
Macquarie Capital and Greenhill & Co are advising on financial aspects. Gilbert + Tobin is handling the legal side of the proposed transaction.
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