MELBOURNE: BHP Billiton Ltd boss Marius Kloppers yesterday started the ball rolling on the biggest takeover in mining history, and the second biggest takeover ever seen.
The world’s largest mining company launched a US$147.4 billion (K432 billion) scrip bid for rival Rio Tinto, months after it began courting the recalcitrant target with an informal offer.
If successful, the deal will create the world’s largest producer of aluminium, coking coal, thermal coal, copper and a dominant player in iron ore.
“It is a once in a lifetime opportunity to gain an oligopoly over the world’s commodities,” DJ Carmichael analyst James Wilson sad.
However, the outcome of BHP Billiton’s pursuit of the world’s third largest mining company, which began almost a year ago, is unlikely to be seen until next year.
BHP Billiton expects to wait about nine months before it can formally open the offer as it works to secure regulatory approvals from every corner of the globe.
That also means there’s still time for a spanner to be thrown in the works.
While the miner yesterday played down the prospect of a competing bid, the presence of of China’s state-owned aluminium group Chinalco and US aluminium producer on the Rio Tinto register has given investors reason to pause.
Chinalco and Alcoa last Friday secured a 9% interest in the UK and Australian-listed group.
Chinalco and Alcoa this week insisted the move was a strategic investment but market watchers are sceptical.
Kloppers was unfazed about Rio Tinto’s newest shareholders, saying BHP Billiton had done its homework.
“I think the offer terms is very favourable to all the Rio Tinto shareholders, and indeed Chinalco as well,” he said. – AAP