BHP announces decision to proceed with unification plan

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Image credit: www.bhp.com

BHP has announced a final Board decision to unify BHP’s corporate structure under its existing Australian parent company, BHP Group Limited.

At present, BHP operates under a dual-listed company (DLC) corporate structure, which was founded in 2001 when BHP and Billiton merged.

The DLC structure is made up of two parent companies: BHP Group Limited (Limited) in Australia and BHP Group Plc (Plc) in the United Kingdom, each of which have their own stock market listings and share registries.

Limited and Plc shares have similar voting and economic rights, and they function as a single economic organization with a shared board of directors and management.

BHP Chair, Ken Mackenzie said the move would result in a corporate structure that is simpler and more efficient, reduces duplication and streamlines the company’s governance and internal processes.

“BHP is in great shape and now is the right time to make strategic, transformative changes for the future,” he stated.

“Unification will create one parent company, one share register and one share price globally.

“We believe this is the best structure for BHP to provide the resources the world needs and create long-term shareholder value.”

BHP CEO, Mike Henry said a unified structure would also improve flexibility for portfolio reshaping to maximise shareholder value over the long-term, including facilitating a simpler separation of the Petroleum business.

“A unified corporate structure will make BHP simpler and more agile, with the strategic flexibility required to shape our portfolio to deliver value through producing the commodities needed for continued economic growth, improved living standards, electrification and decarbonisation,” Mr Henry said.

“We will retain listings in the UK, US, South Africa and Australia, providing BHP with continued access to global markets and giving shareholders the opportunity to benefit from our portfolio, management and operating performance for long-term value.”

Subject to shareholder and regulatory approvals, the unification is expected to complete by 31 January 2022.

For more information see BHP’s ASX announcement.