Diversified miner Anglo American on Wednesday denied BHP’s request for more time to engage on a proposed takeover transaction, stating that its fundamental concerns regarding the $49-billion proposal remain unchanged.
With time running out, BHP now only has until 16:00 GMT to announce a firm intention to make an offer for Anglo, or walk away for six months.
Earlier on Wednesday, BHP asked for more time to try and win over Anglo, which has already rejected three proposals from its larger rival.
BHP on Wednesday proposed a range of socioeconomic measures intended to address Anglo’s concerns regarding its transaction structure. The group also indicated that it would be willing to discuss an appropriate reverse break fee, payable by BHP, on failure to achieve the necessary anti-trust and regulatory approvals, including in South Africa.
Anglo said that while there had been extensive engagement with BHP and its advisers, the socioeconomic measures put foward to support regulatory approvals, were confined in scope, impact and duration.
"This approach does not sufficiently address the fact that Anglo American's shareholders would bear disproportionate execution and value risks and uncertainty over an extended period, nor does it consider that material conditions would likely be imposed in relation to both Anglo American Platinum and Kumba which would require the approvals of their respective boards.
"This value risk would therefore be exclusively for the account of Anglo American's shareholders under the BHP proposal, as well as eroding the value of the shares held by the minority shareholders of both subsidiary companies," said Anglo.
Further, Anglo said that BHP continued to restate its belief that the risks of its complex structure were not material, yet it remained unwilling to amend its proposed structure to assume these risks.