Anglo American Turns Down BHP’s $49 Billion Takeover Extension Request

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SAFRICA - MINING - COMPANY - ANGLOAMERICAN
A picture taken on January 16, 2013 shows Anglo American Platinum mine in Rustenburg, northwest of Johannesburg. Amplats announced on January 15 it would close four shafts and sell a mine in sweeping restructuring, saying operations had become unsustainable. The vast majority of job cuts -- 13,000 in all -- would be made around Rustenburg. Last year's protests lead to the deaths of over 50 people, the majority strikers shot by police in one day of bloodshed at the Marikana platinum mine. STEPHANE DE SAKUTIN/AFP via Getty Images

On Tuesday, May 28, VCPost reported that well-known UK companies, Royal Mail and Anglo American are preparing for foreign takeovers.

However, in a development that could impact the mining industry, Anglo American has declined BHP Group's request to extend the discussions on the proposed $49 billion takeover. Per CNBC, this rejection suggests there may be a deadlock or lack of agreement between the two companies as they approach the deadline for finalizing any deal.

Despite BHP's efforts to sway Anglo American with socio-economic incentives, including investment pledges and local employment guarantees, the British miner remains steadfast, citing unresolved concerns over the proposed deal's inherent risks.

As the deadline for the takeover bid approaches, the high-stakes negotiations between the two mining giants are uncertain, considering that experts see it as a possible mega deal.

READ MORE : Anglo American Announces Plans to Leave Diamond, Platinum, Coal Mining to Avoid BHP Acquisition Plans

Anglo American and BHP

Anglo American and BHP Group are both major players in the mining industry:

Specifically, Anglo American engages in global exploration, extraction, processing, and marketing of various resources, such as iron ore, diamonds, copper, platinum, and coal. Meanwhile, BHP Group, previously known as BHP Billiton, operates in a similar capacity, adding nickel and petroleum to its portfolio.

BHP's takeover of Anglo American could achieve more significant economies of scale, leading to cost savings and improved profitability since the two mining heavyweights already boast assets and operations that no other mining companies have.

The UK-based mining company previously indicated that it is unlikely to entertain BHP's acquisition proposal, opting to exit diamond, platinum, and coal mining to prevent the potential takeover.

Anglo American has not yet provided an official statement explaining their decision.

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