BHP
(ASX:BHP) has moved to fill a gap in its portfolio with an apparently hostile bid for OZ Minerals
(ASX:OZL) at $25 a share.
The non-binding offer values you OZ at $A8.3 billion, $2 billion more than the closing value on Friday. ($18.92).
OZ Minerals directors though have rejected the BHP approach, forcing the world’s biggest miner to go public.
In its statement, BHP said its “proposal represents a significant premium to the market value of OZL at the time the Proposal was submitted, at a price that was materially above the average broker price targets.”
“The cash offer would deliver immediate value to OZL shareholders and de-risk any value which may (or may not) eventually be reflected in OZL’s share price.
BHP’s proposal is subject to certain conditions including completion of confirmatory due diligence to the satisfaction of BHP, entry into a scheme implementation agreement and a unanimous recommendation from the OZL Board that OZL shareholders vote in favour of the Proposal in the absence of a superior proposal.
BHP CEO Mike Henry said:
“Our proposal represents compelling value and certainty for OZ Minerals shareholders in the face of a deteriorating external environment and increased OZL operational and growth-related funding challenges.
“We are disappointed that the Board of OZL 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.”
In a separate statement, OZ Minerals said it had been advised by BHP that it has accumulated an interest in OZ Minerals shares via derivative instruments amounting to less than 5%.
“The Board has carefully assessed the Indicative Proposal including with the assistance of its financial and legal advisers. The Board has unanimously determined that the Indicative Proposal significantly undervalues OZ Minerals and, as such, is not in the best interests of shareholders.
OZ Minerals Managing Director and Chief Executive Officer, Andrew Cole said:
“We have a unique set of copper and nickel assets, all with strong long-term growth potential in quality locations. 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,” Mr Cole said.
