Iron ore mining in western Australia.
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Mining giant Anglo American on Friday rejected a takeover bid from rival BHP Group, saying the offer “significantly undervalues” the company and its future prospects.
Australia-based BHP on Thursday said it had made an all-share takeover offer which valued the smaller company at £31.1 billion ($38.9 billion). The takeover would have created the world’s largest mining company, according to a Reuters analysis.
Shares of Anglo American were trading down 0.5% at 9:00 a.m. London time, while other mining stocks rose.
In a statement, the British miner said that board members had unanimously rejected BHP’s “unsolicited, non-binding and highly conditional” proposal.
The offer had included a requirement for Anglo American to demerge its entire shareholdings in South Africa-based Anglo American Platinum Limited and Kumba Iron Ore Limited.
Anglo American Chairman Stuart Chambers said the proposed restructure was “highly unattractive, creating substantial uncertainty and execution risk borne almost entirely by Anglo American, its shareholders and its other stakeholders.”
Shares of Anglo American Platinum and Kumba Iron Ore both rose in early deals.
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