According to a person familiar with the matter, key shareholders of Anglo American, including the asset management firm BlackRock, encouraged the mining company to continue engaging in talks with BHP Group over the proposed £38.6 billion ($49.18 billion) merger.
BHP, the world’s largest listed mining group, has been granted a one-week extension until May 29 to make a firm bid for Anglo American. If no deal is reached by then, BHP will be forced to walk away from the potential merger for at least six months under the UK’s takeover rules.
The Financial Times first reported the news, stating that BlackRock, which owns a 9.6% stake in Anglo American, was among a handful of investors that pushed for meaningful negotiations with BHP. Two other significant shareholders, Ninety One and Sanlam Investments, also backed the decision to extend the talks, despite concerns over the deal structure that would require Anglo American to spin off its stakes in the South African platinum and iron ore units.
Ninety One and Sanlam Investments did not respond to Reuters’ requests for comment.
While BHP is reportedly firm on the structure and value of its latest takeover proposal, the company is focused on addressing Anglo American’s concerns over execution risks in the coming week. According to the Financial Times, BHP’s representatives believe there is only scope for “smaller, creative structures to better share the risks,” while people close to Anglo American have stated that the structure needs to be altered or BHP must offer a higher price.
Neither Anglo American, BHP Group, nor BlackRock have provided any official comment on the reported developments.