BHP Abandons Takeover Move for Anglo American in Mining Power Struggle

The Australian mining giant BHP has withdrawn its bid to acquire Anglo American, halting what would have been one of the largest merger deals in the mining sector. The decision came just hours after confirmation that both companies had entered talks regarding a possible agreement.

BHP stated it was no longer pursuing a combination with Anglo American after preliminary discussions with the board of the London-listed mining group. The Australian miner noted the considerable strategic value such a merger might have delivered but reaffirmed confidence in its own organic growth opportunities. This announcement follows BHP’s previous unsuccessful takeover attempt last year, marking a second failed pursuit within 17 months.

Anglo American reportedly rejected BHP’s offer, viewing it as less attractive compared to its ongoing negotiations over a merger with its Canadian peer, Teck Resources. This proposed merger, valued at around 53 billion US dollars, represents one of the most significant transactions the mining industry has seen and could reshape global mining if approved. Shareholders from both Anglo American and Teck will vote on the deal next month, and the alliance will also require authorisation from regulatory bodies in China, the United States, and Canada.

The Canadian government is seeking additional assurances that a merger between Anglo American and Teck Resources would provide tangible benefits to Canada. Should Anglo American have chosen to pursue a fresh deal with BHP, it would have been required to pay a break fee of 330 million US dollars to Teck, as stipulated in the merger agreement.

Anglo American’s share price has surged by nearly a third over the past year, driven by the disposal of non-core assets aimed at sharpening the company’s focus on its copper and iron ore divisions. The miner is also preparing to dispose of its De Beers diamond unit, which for many years dominated the global diamond market. Over the same period, BHP’s share price has remained largely unchanged.

The board of Anglo American has refrained from making any public comments regarding the developments and the future direction of its partnerships remains closely watched by investors and analysts worldwide.