No signs of OZ Minerals slowing down as BHP takeover looms

OZ Minerals is ploughing ahead with its flagship project even as it's being pursued for a takeover by global mining giant BHP.

Key points
  • OZ Minerals shareholders voted yesterday in favour of BHP’s $9.8 billion takeover offer
  • The ASX 200 copper miner is moving ahead with design and construction contracts at its West Musgrave Mineral Processing Plant in WA
  • GR Engineering Services estimates two-year revenue of $312 million from its newly inked contracts with OZ Minerals

OZ Minerals Limited (ASX: OZL) management certainly isn't sitting on its laurels.

As you're likely aware, the S&P/ASX 200 Index (ASX: XJO) copper miner is being pursued by global mining giant BHP Group Ltd (ASX: BHP).

BHP made its first acquisition offer on 8 August, offering $25 cash for the copper miner's shares.

That offer was rejected by the board. But BHP didn't walk away.

Yesterday OZ Minerals shareholders voted on an improved offer of $28.25 per share. More than 98% voted in favour of the acquisition deal, which values the copper stock at $9.8 billion.

But as we said up top, that hasn't seen the company's operations slow down.

A man wearing a hard hat and high visibility vest looks out over a vast plain.

Image source: Getty Images

What are the latest developments?

In an ASX release this morning, GR Engineering Services Ltd (ASX: GNG) announced that it's entered into two contracts with OZ Minerals Musgrave Operations – a wholly owned subsidiary of OZL.

The contracts involve designing and constructing the West Musgrave Mineral Processing Plant, located in Western Australia. Revenue on completion of the contracts is forecast to be $312 million over a two-year period.

"We are pleased to have been engaged by OZ Minerals to play a key role in the delivery of the world-class West Musgrave Project," said Tony Patrizi, managing director at GR Engineering.

Commenting on the deal, Debbie Morrow, project executive for OZ Minerals added:

We're delighted to be working with GR Engineering on the design and construction of the Minerals Processing Plant for the West Musgrave Project, which is set to be one of the largest, lowest cost, lowest emissions copper nickel projects.

GR Engineering is being contracted for engineering design, drafting, project management and commissioning, as well as structural, mechanical, piping, electrical and instrumentation construction works.

OZ Minerals share price snapshot

As you can see in the chart below, the ASX 200 copper stock enjoyed a big lift back in August following BHP's initial takeover offer.

Over the past 12 months, OZ Minerals shares are up 5%.

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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