Anglo American has dismissed a takeover bid from rival miner BHP Group, valuing it at 31.1 billion pounds ($38.88 billion). Anglo Chairman Stuart Chambers stated the offer significantly undervalued the company’s prospects and would dilute the relative value of Anglo American’s shareholders compared to BHP’s shareholders. Anglo shares saw a 16.1% rise to 25.60 pounds in London trading following the bid announcement.
BHP offered 25.08 pounds per Anglo share, a 31% premium over Anglo’s previous close, but faced skepticism from some of its investors regarding the deal’s merits. Pendal’s Portfolio Manager Brenton Saunders expressed surprise at the lack of an agreed deal, suggesting that BHP might have to offer more to win over shareholders and management. BHP now faces a deadline of May 22 to make a binding bid.