BHP back in SA ahead of possible renewed bid for Anglo

Mike Henry, CEO, BHP

MIKE Henry, CEO of BHP, met government officials in South Africa last week, fuelling speculation that the Australian miner will resurrect its failed £39bn bid for Johannesburg-based rival Anglo American, said the Financial Times.

Henry and chief development officer Catherine Raw met South Africa government officials and the Public Investment Corporation, the state-owned asset manager, said the newspaper citing three people with knowledge of the details.

Raw, who joined BHP in April, is in charge of mergers and acquisitions and was involved in the first Anglo approach, said the Financial Times.

PIC is the second-largest shareholder in Anglo, with a 7.5% stake. South Africa’s government is also a shareholder in BHP, with a 3.7% stake at the time of the most recent annual report.

BHP was examining how it might make a renewed offer after the standstill period comes to an end on November 29, according to bankers seeking advisory or financing roles. However, they cautioned no decision had been made.

“The consensus view is that they are coming back, if they can figure it out,” one banker said. Another said it was an “open secret” that BHP was considering whether to make a bid. BHP declined to comment.

BHP said iron ore output in its first quarter rose 2% from the year-before, as moves by major miners to ramp up production raise the specter of over-supply.

The world’s largest miner produced 64.6 million tons (Mt) of iron ore over the three months to the end of September, said Bloomberg News citing third quarter production report on Thursday. Full-year guidance for its iron ore operations was kept at 255 to 265.5Mt.

“China has announced a series of monetary easing policies in an effort to support economic growth, and has indicated more significant fiscal stimulus is on the horizon,” said Henry. “Upcoming stimulus is likely to focus on relieving local debt, stabilising the property market and bolstering business confidence.”