A multinational mining company is set to acquire five operations from a rival.
BHP recently received approval to start working on its proposed $9.6 billion takeover offer for OZ Minerals (OZL).
BHP’s advisory team comprising of Citigroup and Barrenjoey will spend the next four weeks exclusively performing due diligence on the target company, which separately appointed Macquarie Capital, Greenhill & Co and Gilbert + Tobin. Advisors from both sides will then collaboratively draft a scheme implementation agreement.
OZL’s board intends to “unanimously recommend” the latest $28.25 per share deal, which is 13 per cent higher than the previous $25 per unit offer.
“The revised proposal from BHP follows a period of board-level engagement, securing a circa $1.1B increase to the initial proposal. It is the board’s view that progressing the revised proposal, including providing BHP with access to due diligence, is in the best interests of OZL’s shareholders and other stakeholders,” OZL chairman Rebecca McGrath said in a public statement.
BHP intends to completely absorb the target’s 3420-strong workforce across the following operations:
- Prominent Hill, 650km northwest of Adelaide
- Carrapateena, 160km north of Port Augusta
- West Musgrave, 500km west of Uluru
- Carajás East and West, Brazil
- Gurupi Province, Brazil.
“BHP expects to retain the vast majority of the OZL team who would become part of a much larger organisation with access to industry-leading employee benefits including training programs, flexible work options and career progression opportunities – both domestically and internationally – across a suite of commodities,” the bidder said in a public statement.
BHP believes consolidation will increase its exposure to “future facing” commodity markets.
“The acquisition would add copper and nickel resources that are essential to support the global megatrends of decarbonisation and electrification. This is consistent with BHP’s strategy to deliver long term value and returns through owning a portfolio of … assets with exposure to highly attractive commodities that benefit from global megatrends,” the company said.