BHP considering improved proposal for Anglo American after bid was rejected, source says

A worker is seen at Anglo American’s Los Bronces copper mine in Chile, obtained by Reuters on April 26, 2024. Anglo American/Handout via REUTERS/ File Photo

(Reuters) -BHP Group is considering making an improved proposal for Anglo American after its $39 billion initial offer was rejected by the London-listed miner, a source familiar with the matter told Reuters.

BHP is in discussion for revised proposal for Anglo American in the coming weeks, the source said. The deliberations are currently ongoing and it has not made a decision on the size and structure of the new proposal, the source added.

BHP and Anglo American did not immediately respond to a Reuters request for comment.

Anglo American had rejected BHP’s $39 billion takeover offer on Friday saying it significantly undervalued the miner and its future prospects.

BHP has until May 22 to come back with a formal offer for Anglo American. It is expected to sweeten its 25.08 pound per share offer to try to clinch a deal that would create the world’s biggest miner of copper, a metal central to the clean energy shift.

Much of the focus of BHP’s bid has been on copper. A tie-up with Anglo would forge a group accounting for about 10% of global output of the metal, which due to its conductivity and resistance to corrosion is used in everything from electric vehicles and power grids to construction.

A deal, if successful, would be the largest mining takeover globally in 2024 and among the top 10 largest deals for the sector ever, LSEG data showed.

Bloomberg News first reported the news about BHP’s improved proposal for Anglo American.

(Reporting by Rishabh Jaiswal in Bengaluru and Clara Denina, Editing by Timothy Heritage and David Evans)