Miner Oz Minerals has rejected a takeover bid from mining giant BHP and the Australian share market ended higher after a slow start.
The market fell as much as 0.4 percent in early trade, but managed to post a gain at the close.
Australia’s All Ordinaries rose 0.1% to 7,260, while the ASX 200 rose 0.07% to 7,021.
Most sectors were in the red on the ASX 200, with property companies, consumer stocks and technology companies weighing on the market.
Four sectors rose with industrials, oil stocks and miners the best performers.
Oz Minerals (+35.3%) was the best performer on the ASX 200, followed by lithium firm Lake Resources (+15.6%) and biotech firm Imugene (+9.6%).
Losses were led by bank and insurer Suncorp (-4.6%) and investment house Magellan Financial Group (-3.6%).
Commodity operator Aurizon (-3.5%) said net profit for 2022 fell 15% to $513 million due to lower volumes and freight rates and the purchase of the coal freight company One Rail.
It cut its final dividend payment from 14.4 cents a share to 10.9 cents a share.
Mayne Pharma surged after winning US approval for a hormonal contraceptive device.
In other news, Beach Energy signed a sale and purchase agreement with BP Singapore.
The Australian dollar was up 0.4% at 69.3 US cents by 16:10 AEST.
Spot gold was steady at $1,773.71 an ounce, while Brent crude rose 0.7% to $95.54 a barrel in afternoon trade.
Oz Minerals rejects BHP takeover
Copper and nickel miner Oz Minerals rejected an $8.3 billion takeover bid from BHP, which seeks metals that are crucial to the development of electric vehicles.
Oz Minerals said the unsolicited conditional takeover offer of $25 per share was “highly opportunistic” and significantly undervalued the company.
BHP pursues metals such as nickel and copper used to make electric vehicle batteries. (Reuters: Aly Song)
The company also said the offer came at a time when the LME copper price and OZ Minerals share price had fallen from their recent peaks in March and January.
OZ Minerals managing director and chief executive Andrew Cole said BHP’s offer was not in the best interests of shareholders.
“We have a unique set of copper and nickel assets, all with strong long-term growth potential in quality locations,” Cole said.
“We extract minerals that are in high demand, particularly for the global theme of electrification and decarbonisation and we have a long-lived resource base and reserves.
“We do not consider that BHP’s proposal sufficiently recognizes these attributes.”
Last week, BHP said it would increase spending on nickel exploration over the next two years to meet growing demand for the metal from electric vehicle battery makers.
BHP has supply deals with Tesla, Toyota and Ford through its Nickel West unit, and is looking to buy more copper and nickel assets around the world.
Its chief executive, Mike Henry, said he was disappointed that BHP’s takeover bid had been rejected.
“Our proposal represents compelling value and certainty for OZ Minerals shareholders in the face of the deteriorating external environment and increased [Oz Mineral] operational and financing challenges related to growth,” he said.
“We are disappointed that the OZL board has indicated that it is not prepared to entertain our compelling offer or provide us with access to due diligence in relation to our proposal.”
BHP used to own the West Musgrave nickel and copper project in Western Australia, which is now owned by Oz Minerals.
Oz Mineral shares rose 35 percent to $25.59, while BHP shares rose 0.8 percent to $39.12.
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The floods hit Suncorp’s profits
Bank and insurer Suncorp said its annual profit fell 34% to $681 million as claims from natural disasters and stock market volatility hit its investment portfolio.
Suncorp said the La Niña weather pattern in Australia and New Zealand had led to 35 separate weather events and about 130,000 natural hazard claims.
This saw Suncorp overshoot its natural risk provision by $101m, although it made significant recoveries from its reinsurance programme.
Suncorp said it increased home insurance premiums to reflect higher natural risk and reinsurance costs.
Home loans rose 9 percent and the company saw record growth in insurance premiums in the second half of the year.
The company said it was progressing with plans for ANZ to buy its banking arm, subject to regulatory approvals.
Any transaction is expected to take approximately 12 months.
Suncorp Bank’s net profit fell 12.2% to $368 million, and investors got a fully franked dividend of 17 cents a share.
The Commonwealth Bank (+1.2%) took a $445m hit from one-off items, including software downloads, but made a pre-tax profit of $516m on the sale of a 10% stake in the Chinese bank, the Bank. from Hangzhou.
US job growth
Wall Street ended mixed on Friday local time after a strong US jobs report reignited fears of more interest rate hikes by the Federal Reserve.
Official figures showed US employers hired far more workers than expected in July, with the unemployment rate falling to 3.5% from 3.6%, the lowest level in 50 years years.
Employers hired 528,000 people during the month, more than double the number expected by economists.
The S&P 500 fell 0.16% to 4,145, the Dow rose 0.2% to 32,804, and the Nasdaq Composite fell 0.5% to 4,145.
ABC/Reuters