The OZ Minerals Limited (ASX: OZL) share price will be on watch this morning.
This follows the announcement of a new takeover approach from BHP Group Ltd (ASX: BHP).
OZ Minerals share price on watch
The OZ Minerals share price could be heading higher today after the company revealed that BHP has improved its previous $25.00 per share offer.
According to the release, BHP has submitted a revised non-binding indicative proposal to acquire 100% of OZ Minerals by way of a scheme of arrangement for a cash price of $28.25 per share. BHP stressed that this offer price represents the best and final price BHP is willing to offer under the revised proposal, in the absence of a competing proposal.
Offer accepted
The good news for BHP, is that this final offer has been enough for the OZ Minerals board, which intends to unanimously recommend the proposal to shareholders as being in their best interests.
This is in the absence of a superior proposal and subject to the two parties entering into a binding scheme implementation agreement following completion of BHP's confirmatory due diligence. It will also be subject to an independent expert concluding that the proposal is in the best interests of shareholders.
While the offer is only a 7.4% premium to the OZ Minerals share price at Tuesday's close, it represents a 49.3% premium to where its shares were trading prior to the initial proposal back in August.
The release notes that OZ Minerals will have the right to consider paying a franked dividend to shareholders prior to the transaction being implemented. However, the cash consideration price will be reduced by the cash component of any dividends or return of capital.
Management commentary
OZ Minerals chair, Rebecca McGrath, commented:
The Revised Proposal from BHP follows a period of Board-level engagement, securing a circa $1.1 billion increase to the Initial Proposal. It is the Board's view that progressing the Revised Proposal, including providing BHP with access to due diligence, is in the best interests of OZ Minerals' shareholders and other stakeholders. The Board will continue to update shareholders as appropriate.
OZ Minerals CEO, Andrew Cole, added:
BHP's Revised Proposal is a clear reflection of OZ Minerals' unique set of highly strategic, quality assets in quality jurisdictions and an enviable multigenerational growth pipeline of copper and nickel assets in strong demand due to global electrification. We look forward to working with BHP in a collaborative way to progress the Revised Proposal in the best interests of OZ Minerals' and its stakeholders.
