Copper checkers: What's next for BHP shares after Anglo talks?

The miner's long term strategy hasn't changed.

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Shares of BHP Group Ltd (ASX: BHP) are slipping slightly on Friday following yesterday's collapse of the miner's $74 billion bid to acquire Anglo American.

Despite the failed bid, investor reaction has been fairly muted in Friday's trade. At the time of writing, BHP shares are trading at $44.02, down 0.64% from yesterday's close of $44.30.

In comparison, the S&P/ASX 200 index (ASX: XJO) is currently up 0.5%.

A quick recap of the deal

The miner announced earlier this year that it was in talks to buy Anglo American. BHP shares have been volatile since.

BHP's pursuit of Anglo was aimed at significantly boosting its copper assets. But despite three increasingly attractive offers, Anglo's board rejected each of the ASX share's proposals.

And despite a one-week extension to negotiate further, Anglo's board was unconvinced of the benefits of BHP's latest revised offer. The latest attempt to secure a deal ended yesterday, just before the takeover deadline.

"BHP will not be making a firm offer for Anglo American", the Australian miner's CEO Mike Henry said.

"While we believed our proposal for Anglo American was a compelling opportunity, we were unable to address Anglo's specific concerns, particularly regarding South African regulatory risk and cost," he added.

What's next for BHP shares?

With the Anglo American deal off the table for now, investors may be left wondering about what's next for BHP shares. British regulations prevent BHP from making another offer for at least six months unless a competing bid emerges.

BHP's interest in Anglo was driven by its strategy to enhance its copper portfolio. Copper is a critical metal in the transition to a greener economy and is in hot demand.

Highlighting this is BHP's recent acquisition of South Australian copper miner Oz Minerals for $6.4 billion. Some criticised the move for its high price, but recent surges in the copper price have vindicated the decision.

BHP also has a majority stake in the Escondida mine in Chile, the world's largest copper mine. It is set to showcase the Escondida site later this year, according to the Australian Financial Review.

Other copper assets?

Although BHP now can't pursue Anglo for six months, it's unlikely to sit idle. Analysts suggest it might target other copper assets, with South American mines like Antofagasta being potential candidates.

Argonaut's head of research, Hayden Bairstow, believes BHP's keen interest in copper will keep it on the lookout for valuable assets and potentially impact its shares.

Speaking to the ABC, Bairstow said: "I don't think this story is finished by any stretch of the imagination," highlighting BHP's long-term strategy to dominate the copper market.

This is something to consider for the outlook on BHP shares going forward, in my view.

Foolish takeaway

The BHP share price has been volatile lately, down 13% year-to-date, as the graph below shows.

BHP's share price might have dipped due to the failed Anglo American bid, but the miner's commitment to expanding its copper assets appears unwavering.

As the market watches for BHP's next strategic move, its focus on future-facing commodities like copper could be promising. Only time will tell.

Motley Fool contributor Zach Bristow 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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