OZ Minerals (OZL) said that its board intends to recommend a revised takeover proposal of A$28.25 ($18.95) per share in cash from BHP, which translates to an enterprise value of A$9.6bn ($6.44bn).

The Australian mining company said that the proposed consideration is the best and final that BHP is willing to offer.

OZ Minerals’ board has confirmed to BHP that it plans to recommend the revised proposal unanimously to the company’s shareholders as being in their best interests, in the absence of a superior proposal.

The recommendation is also subject to the two mining firms executing a binding scheme implementation agreement (SIA) after BHP completes a confirmatory due diligence and an independent expert finds the revised proposal to be in the best interests of OZ Minerals’ shareholders.

In August 2022, OZ Minerals rejected BHP’s takeover bid of A$25 ($16.8) per share in cash or A$8.34bn ($5.6bn) from BHP Group, citing that the proposed deal considerably undervalues its business.

OZ Minerals managing director and CEO Andrew Cole said: “BHP’s Revised Proposal is a clear reflection of OZ Minerals’ unique set of highly strategic, quality assets in quality jurisdictions and an enviable multigenerational growth pipeline of copper and nickel assets in strong demand due to global electrification.

“We look forward to working with BHP in a collaborative way to progress the Revised Proposal in the best interests of OZ Minerals’ and its stakeholders.”

OZ Minerals is engaged in developing a portfolio of long life, low-cost copper-focused assets. It has two operating assets, which are the Prominent Hill copper mine and the Carrapateena copper mine, both located in Australia.

The company and BHP have entered into a confidentiality and exclusivity deed with respect to the latter’s revised proposal.

According to BHP, the proposed deal will enable the creation of a copper basin in South Australia which could tap potential operational synergies driven by the proximity of the Carrapateena and Prominent Hill operations with its own existing Olympic Dam asset and Oak Dam development resource.

BHP CEO Mike Henry said: “BHP’s proposal represents a highly compelling offer for OZL shareholders, providing certainty at a time of macroeconomic uncertainty and market volatility, and increasing risks for the industry.

“The combination of BHP and OZL’s assets, skills and technical expertise provides a unique opportunity not available under separate ownership, with complementary resources including the Oak Dam exploration prospect and existing facilities within close proximity, backed by BHP’s strong balance sheet, capital discipline and commitment to sustainable development.”