Mike Henry is in danger of being considered public enemy number one by supporters of the London Stock Exchange (LSE).
The BHP boss was instrumental in moving the group’s main share listing from the City to Sydney in 2022.
Now he is laying siege to one of London’s great wealth companies, Anglo American.
BHP has been working on the best way to structure a deal for more than a year with a view to gaining control of copper assets seen as the future in the era of green energy.
The UK used to be considered the home of natural resources companies.
Takeover plot: BHP boss Mike Henry (pictured) was instrumental in moving the group’s main share listing from the City to Sydney in 2022.
The potential £29.5bn bid for Anglo would be a further blow to efforts to rebuild London’s reputation as a place to trade shares.
Removing a major component of the FTSE 100 would raise concerns that the London discount – the undervaluation of UK shares relative to their US counterparts – could expose other companies such as Reckitt Benckiser and Burberry to takeover risk.
One of the great strengths of the UK stock markets has been the natural resources sector.
The UK’s close relationship with Australia, South Africa and Canada, where extractive industries are key, gave prestige to the London market.
It attracted resource companies from Latin America and Russia, among other places. In fact, in 2011 the LSE was close to buying the mining-rich Toronto Stock Exchange, but was blocked by Canadian authorities.
BHP will not necessarily succeed in Anglo-American’s pursuit. But it will almost certainly tempt other buyers.
Those mentioned are India’s Vedanta, which made a previous failed bid, or perhaps a Chinese miner.
Glencore, which last year was thwarted in a bid for all of Teck Resources with its valuable copper interests, will be watching. Anglo-American’s board faces a difficult defense.
The share price has remained static for the past two decades while rivals such as BHP prospered.
The shine that came with ownership of De Beers, the world’s leading diamond producer, has faded.
Anglo itself is no longer an enthusiastic owner amid competition from manufactured stones. BHP would almost certainly try to offload De Beers.
It is not just the London Stock Exchange that would suffer a setback if Anglo-American were taken over and split up.
A deal with BHP would likely spark a political backlash in South Africa. The Oppenheimer dynasty (no longer involved) left a lasting mark on South Africa as a liberal force during apartheid.
It is no coincidence that the South African Public Investment Corporation, which manages pensions for government employees, is among the largest shareholders, with 10% of Anglo.
The complex deal with BHP also depends on the separate distribution to existing shareholders of stakes in two listed South African entities, Anglo American Platinum and Kumba Iron Ore.
In the UK, a deal would again call into question the fate of the Woodsmith fertilizer project, near Whitby, North Yorkshire, which employs up to 1,300 people.
Henry’s ultimate goal is to be a dominant force in copper, adding to current operations the ownership of mines in Chile and Peru.
A deal would give BHP around 10 per cent of the global market at a time when demand has been growing exponentially.
Buying companies on the London market has become easy thanks to the replacement of UK-run funds with a variety of US investors interested in quick profits rather than the public interest.
This is not a transaction that will be rushed through. It will be reviewed by competition authorities around the world and that could take 18 months. The fear must be that if Anglo-American is lost, other miners will be shaken from the tree.
Glencore is under pressure from activist Tribeca to move its listing to Sydney. Shell, the largest company in the FTSE 100, has hinted at moving to New York amid concerns that climate change enthusiasts are making Britain hostile to big oil.
Anglo-American will not go away without a fight. The political ramifications for the City and within the group’s South African hinterland may prove more important than the offer on the table.