OZL stock price remains below offer price despite board accepting $6.34 billion offer

OZL stock price remains below offer price despite board accepting $6.34 billion offer
OZL stock price remains below offer price despite board accepting $6.34 billion offer
BHP CEO Mike Henry (pictured far left) discusses the company’s plans with Australian Prime Minister Anthony Albanese (pictured second right)

Australian mining giant BHP Group (BHP) raised the bar and made an improved offer on Friday to take over OZ Minerals (OZL). OZL’s share price rose 3% on Friday on news of the impending acquisition.

OZL’s share price has risen 44% since August, when BHP began to show interest in the group.

BHP, which is known for mining copper for renewables and nickel for electric vehicles, returned to the negotiating table after OZL’s board rejected BHP’s latest offer made in August to 25 Australian dollars (16.80 US dollars) per share, saying it was too low.

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BHP Group (BHP) share price

BHP returned after its bid was rejected

After its rejection this summer, BHP refused to give up and has now increased the offer by 13%, which may have convinced the OZL board, even before shareholders voted on the takeover.

The new offer is for A$9.6 billion ($6.4 billion) and will see BHP acquires copper producer OZ Minerals Ltd, as BHP seeks to be more exposed to the growing demand for clean energy and electric cars.

“BHP has submitted a revised non-binding indicative proposal to the board of directors of OZ Minerals Limited to acquire 100% of OZL by way of a plan of arrangement for a cash price of A$28.25 per share OZL,” a statement from BHP read.

“This offer price represents the best final price that BHP is prepared to offer under the revised proposal, in the absence of a competing proposal,”

But although OZL share price is up today, it is still below BHP’s offer price and OZL share price is currently at AU$27.38.

Global copper market set to soar

Nevertheless, analysts believe that this agreement will benefit BHP very.

BHP, which wants more exposure to copper, will reap the rewards of this deal. JPMorgan predicts the metal could account for 40% of BHP’s earnings by 2030, up from 25% in 2024.

BHP has big ambitions to add more forward-looking minerals to its portfolio and help decarbonize the global economy.

Acquiring OZ Minerals will allow him to do this.

The Global Copper Market is on an upward trajectory and was valued at USD 283.4 Billion in 2021, and it is projected to reach USD 394.21 Billion Metric Tons by 2029 at a CAGR of 4.21% during of the forecast period, depending on the data.

If the deal goes ahead, it will be one of the company’s largest acquisitions since buying Petrohawk Energy Corp for $12.1 billion in 2011.

BHP’s offer to take over OZL has not yet been accepted or approved by shareholders, but what this offer represents is a strong desire for companies, like BHP, to expand the scope of what it currently offers.

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. price stock OZL remains lower price offer despite acceptance of by board of directors dune offer billion dollars

. OZL stock price remains offer price board accepting billion offer

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