81643
Unified BHP Would  Add $22 Billion in Value
Unified BHP Would  Add $22 Billion in Value

Unified BHP Would Add $22 Billion in Value

Unified BHP Would Add $22 Billion in Value

Mining giant BHP would reap US$22 billion in value for shareholders if it restructures into one Australian entity and scraps its dual-listing, a key US hedge fund and activist investor has said.
New York-based Elliott Advisors, a significant shareholder in the world’s biggest miner, has been pushing hard for the Anglo-Australian firm to dissolve its costly dual-listed structure, AFP reported.
But unlike its previous proposal of a new company incorporated and listed in Britain, which was rejected by BHP, Elliott has now suggested a single entity incorporated and headquartered in Australia.
“It is beyond serious doubt that unifying BHP’s current, inefficient DLC (dual-listed company) structure would create significant value for shareholders,” Elliott said in a statement.
Elliott commissioned a report by FTI Consulting that found a restructure would deliver more than $22 billion in value to shareholders if BHP’s British and Australian entities were unified, with $391 million in costs.
In a letter to chairman Ken MacKenzie, it called on the board to publicly commit during its half-year results announcement on February 20 that the firm would “undertake an immediate, independent and transparent review of unification”.
Under the suggested structure, a new Australian umbrella company would acquire the two existing halves of BHP -- BHP Ltd (Australia) and BHP plc (Britain).
It would have a unified shareholder base with a primary listing on the Australian Securities Exchange.
The miner did not have any immediate comment, but previously said the initial proposal would attract significantly more costs than benefits.
David Lennox, a resources analyst at Fat Prophets, said the dual-listing was something of an anachronism.
“There’s no doubt with modern technology, the structure is probably a little antiquated. We don’t need to have two sets of management on either side of the globe anymore,” he told AFP.
“The structure serves them well... it’s outlived its life but that doesn’t mean it’s broken.”

Short URL : https://goo.gl/9RjrrL
  1. https://goo.gl/uvWuYw
  • https://goo.gl/JzYRjw
  • https://goo.gl/6jWTc6
  • https://goo.gl/G1HCQ2
  • https://goo.gl/U4FC7T

You can also read ...

Saudi Arabia Facing Uphill Battles
Saudi Crown Prince Mohammed bin Salman’s Vision 2030 scheme...
The popular Tesla Model S is due to sell by the end of this month in China, at which point the price will go up about $20,900.
More than a week has passed since the US and China fired the...
Switzerland has the smallest ratio with 7.2% of GDP.
The shadow economy in Jordan accounted for 17.38% of the GDP...
The bankruptcy of investment bank Lehman Brothers on September...
German Cabinet Warned of Economic Risks
The chief of Germany’s central bank, Jens Weidmann, warned the...
The Bank of Italy revised its growth estimates down to 1.3% for 2018, and to 1% for 2019.
Italy's already weak growth forecasts were revised downwards...
Airbus, AirAsia Discussing $23 Billion Deal
The Malaysian airline, already the second-biggest customer for...
Pakistan Raises Key Interest Rate
Pakistan’s central bank on Saturday raised interest rates by...

Add new comment

Read our comment policy before posting your viewpoints

Trending

Googleplus