Elliott Investment Management has built a stake of about $1 billion Anglo-Americans Plc, the UK-listed mining company that has received an unsolicited takeover offer from Australia BHP Group GmbH.
The activist hedge fund run by Paul Singer is invested in nearly 33.6 million Anglo-American stocks via derivatives, according to a British regulator filing on Friday that confirmed a report from Bloomberg News. The company accumulated the 2.5 percent stake in recent months, according to people familiar with the matter, who asked not to be identified discussing confidential information.
The investment makes Elliott one of Anglo American’s top 10 shareholders, data compiled by Bloomberg show. Anglo American shares rose as much as 6.3% in London after Bloomberg News reported the holding.
Elliott also has a 0.07% short position in BHP, according to a separate filing. Representatives for Elliott and Anglo American declined to comment.
Elliott’s presence in Anglo American shares comes as the mining company is the subject of takeover interest from BHP. The Australian miner has suggested A takeover that would value the smaller rival at 31.1 billion pounds ($38.9 billion) and create the world’s largest copper producer. Bloomberg News reported BHP’s approach on Wednesday. Anglo American said the proposal significantly undervalued the company.
Singer’s firm is known for intervening in beaten-down stocks and then pushing companies to take actions ranging from stock buybacks to outright sales of the company.
“We like to see value investors on the register,” said Giuseppe Bivona, chief investment officer at another activist, Bluebell Capital Partners, which built a stake in Anglo American in February. The company “is certainly worth a lot more than BHP is offering.”
Anglo American has long been seen as a potential target among the largest mining companies, particularly because it has attractive South American copper operations at a time when most of the industry is looking to increase reserves and production.
But the complicated structure and the mix of other raw materials as well as the strong dependence on South Africa deter interested parties. In February Anglo American reported The company posted a sharp drop in profits and cut its dividend due to falling demand for diamonds and platinum group metals – commodities unique to its portfolio.
BHP has proposed an all-share deal in which Anglo would first carve out controlling stakes in South African platinum and iron ore companies to its shareholders.
Shares in Anglo American closed 3.2% higher at 2,643.00 pence in London on Friday, giving it a market value of around 32.4 billion pounds. The stock rose 16% on Thursday following BHP’s action. Even after this week’s rally, the stock is still more than a third below its peak two years ago.
Elliott took a significant position in BHP in 1991 2017 and pushed it shut spin off certain oil facilities. In 2021 the miner went on strike Offers which extended its phase-out of fossil fuels, including a sale of oil and gas operations Woodside Petroleum Ltd.
Singer’s company has also worked with other metal companies. In 2022, Elliott held discussions with Kinross Gold Corp. that resulted in the miner announcing a $300 million share buyback. And it is the majority shareholder in Triple Flag Precious Metals Corp., which provides financing for mining companies. The company is also forming a new company, Hyperion, to invest in mining assets.