Related News
BHP plans to buy back shares
By Sonali Paul |
November 16, 2010, Tuesday
|
Print Edition
Print Edition
TOP global miner BHP Billiton scrapped its US$39 billion bid for Canada's Potash Corp, the world's biggest deal this year, and bowed to calls from investors to return cash with a US$4.2 billion share buyback.
BHP, conceding defeat for the third straight time on a major proposed acquisition, signaled with its revived share buyback that it had limited opportunities for other big buys.
Shareholders will be eager to hear what further growth prospects the company will chase with its cash pile when BHP Chief Executive Marius Kloppers fronts the group's annual meeting in Australia today.
"Certainly the best investment is probably in themselves at the moment," said Brendan James, a partner at BHP shareholder Perennial Growth, referring to the prospect of a bigger buyback.
Canada blocked BHP's bid for the world's largest fertilizer maker on November 3 and gave BHP a month to prove the takeover would benefit Canada.
"Unfortunately, despite having received all required anti-trust clearances for the offer, we have not been able to obtain clearance under the Investment Canada Act and have accordingly decided to withdraw the offer," BHP Chief Executive Marius Kloppers said in a statement.
It will be tough for the world's largest miner to chase other major buys, given its size and dominance in most of its markets.
"I think the regulatory environment is very difficult to negotiate when you are as big as BHP," said Tim Schroeders, a portfolio manager at Pengana Capital, who has shares in BHP.
"They have been very ambitious in terms of the size of deals that have been proposed and that makes it very difficult to fly under the radar in terms of the regulatory process."
BHP said Ottawa was asking for too many concessions beyond the more than US$1 billion worth of undertakings the company had already offered as benefits to Canada.
In the first public comments on why Ottawa blocked BHP, Canadian Industry Minister Tony Clement said it was partly because BHP lacked expertise in potash mining and marketing, so it was not clear the deal would benefit Canada.
BHP, conceding defeat for the third straight time on a major proposed acquisition, signaled with its revived share buyback that it had limited opportunities for other big buys.
Shareholders will be eager to hear what further growth prospects the company will chase with its cash pile when BHP Chief Executive Marius Kloppers fronts the group's annual meeting in Australia today.
"Certainly the best investment is probably in themselves at the moment," said Brendan James, a partner at BHP shareholder Perennial Growth, referring to the prospect of a bigger buyback.
Canada blocked BHP's bid for the world's largest fertilizer maker on November 3 and gave BHP a month to prove the takeover would benefit Canada.
"Unfortunately, despite having received all required anti-trust clearances for the offer, we have not been able to obtain clearance under the Investment Canada Act and have accordingly decided to withdraw the offer," BHP Chief Executive Marius Kloppers said in a statement.
It will be tough for the world's largest miner to chase other major buys, given its size and dominance in most of its markets.
"I think the regulatory environment is very difficult to negotiate when you are as big as BHP," said Tim Schroeders, a portfolio manager at Pengana Capital, who has shares in BHP.
"They have been very ambitious in terms of the size of deals that have been proposed and that makes it very difficult to fly under the radar in terms of the regulatory process."
BHP said Ottawa was asking for too many concessions beyond the more than US$1 billion worth of undertakings the company had already offered as benefits to Canada.
In the first public comments on why Ottawa blocked BHP, Canadian Industry Minister Tony Clement said it was partly because BHP lacked expertise in potash mining and marketing, so it was not clear the deal would benefit Canada.
- About Us
- |
- Terms of Use
- |
-
RSS - |
- Privacy Policy
- |
- Contact Us
- |
- Shanghai Call Center: 962288
- |
- Tip-off hotline: 52920043
- 沪ICP证：沪ICP备05050403号-1
- |
- 互联网新闻信息服务许可证：31120180004
- |
- 网络视听许可证：0909346
- |
- 广播电视节目制作许可证：沪字第354号
- |
- 增值电信业务经营许可证：沪B2-20120012
Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.
