Anglo American Denies BHP Request to Extend Deadline Over $50B Offer

Takeover talks between two of the world’s largest mining companies appear to be over for now as Anglo American said that it will not provide BHP Group (BHP) with another extension to address issues with the latest offer it rejected last week, meaning the companies’ negotiation deadline is Wednesday afternoon.

The announcement could spell at least a temporary end to BHP’s takeover bid, which has included three offers, with the latest valuing Anglo American at roughly $50 billion. The London-based mining giant said Wednesday that after “extensive engagement” with BHP over the last week, its latest offer still includes the “highly complex and unattractive structure” that led Anglo American to reject previous offers.

That “unattractive structure” includes an all-stock bid valuing Anglo American at $49.87 billion, along with requirements that Anglo spin off two of its South African subsidiaries, a move Anglo said would be costly and create other regulatory hurdles.

BHP said in a statement earlier Wednesday that the company was confident it had provided “a viable pathway” for the deal to get done, calling the risks Anglo identified “quantifiable and manageable.”

How Anglo American and BHP Got Here

Last month, BHP opened the negotiations with an offer of roughly $39 billion in the hopes of strengthening its copper mining portfolio at a time when demand is rising for copper to be used for renewable energy projects and electric vehicles.

Citing the deal’s complexity and Anglo’s belief that the offer undervalued the company, it was rejected, leading BHP to up its second bid to around $43 billion. After rejecting the second offer, Anglo announced plans for a shake-up to give the company a “radically simplified portfolio,” including plans to spin off or sell a number of assets.

Anglo rejected a third offer last week, and agreed to extend the negotiation deadline by another seven days. The company said it was “confident in Anglo American’s standalone future prospects” when it rejected BHP’s latest offer.

American depositary receipts (ADRs) of Australian mining giant BHP on the New York Stock Exchange (NYSE) were up 1.5% an hour before the opening bell, while Anglo’s shares on the London Stock Exchange were down 1.5% as of 8:35 a.m. ET Wednesday.