Oz Minerals rejects $8bn BHP takeover bid

The board of South Australian copper and nickel miner Oz Minerals has rejected an $8.4 billion takeover bid from global mining giant BHP.

Aug 08, 2022, updated Aug 08, 2022
Workers at Oz Minerals' Prominent Hill mine.

Workers at Oz Minerals' Prominent Hill mine.

BHP told the ASX this morning it had submitted a non-binding indicative proposal to the Oz Minerals board on August 5 to acquire 100 per cent of the company’s shares at $25.00 each – a 32 per cent premium on the company’s last trading price of $18.92.

Oz Minerals announced this morning that it had rejected the “unsolicited” offer.

“We have a unique set of cooper and nickel assets, all with strong long-term growth potential in quality locations,” Oz Minerals managing director Andrew Cole said.

“We are mining minerals that are in strong demand particularly for the global electrification and decarbonisation thematic and we have a long-life Resource and Reserve base.

“We do not consider the proposal from BHP sufficiently recognises these attributes.”

BHP CEO Mike Henry said he was disappointed Oz Minerals had rejected the offer.

“Our proposal represents compelling value and certainty for OZ Minerals shareholders in the face of a detrioating external environment and increase OZL operational and growth-related funding challenges,” he said.

“We are disappointed that the Board of OZL has indicated that it is not willing to entertain our compelling offer or provide us with access to due diligence in relation to our proposal.”

Oz Minerals ranked as the second biggest South Australian company in the 2021 South Australian Business Index.

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The company, which operates the Prominent Hill and Carrapateena copper-gold mines in SA’s north, recorded a net profit of $531 million for the 2021 calendar year.

Oz Minerals described BHP’s takeover bid as “highly opportunistic” given a recent slump in copper prices and argued it “significantly undervalues” the company.

“OZ Minerals has consistently traded above the proposed offer price for the equivalent of more than 5 of the last 12 months,” Oz Minerals told the ASX.

“The OZ Minerals Board and management team acknowledge the strong ongoing support it has received from its stakeholders to date and will continue to work with them on building a best-in-class global copper business with the objective of maximising long term shareholder value.”

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