BHP Bid to Buy De Beers is "Doomed"
May 29, 24.jpg)
(IDEX Online) - BHP's $49bn takeover bid for mining rival Anglo American - parent company of De Beers - today appear doomed, with just hours left before the regulator's deadline (4pm GMT, 29 May) forces it to walk away from a possible deal.
Anglo rejected BHP's initial all-share bid five weeks ago for $39bn, as well as two increased bids.
Earlier today it also rejected a revised bid which put no more cash on the table but undertook to implement an unquantified break-fee and socio-economic investments.
Anglo agreed to a one-week extension to the original deadline last week, but today its board unanimously refused BHP's request for any more time.
Anglo's favored option is to go ahead with its restructuring plan which would include selling off De Beers - currently a loss-maker - and other assets to focus on its more profitable operations, notably copper.
"BHP has not addressed the board's fundamental concerns relating to the disproportionate execution risk associated with the proposed structure and the value that would ultimately be delivered to Anglo American's shareholders," said Anglo in an announcement.
UK takeover rules mean that if BHP fails to make a firm offer before today's deadline, it cannot make another approach for six months.