Top investors criticise BHP as it slashes dual nationality
The FTSE 100 is set to lose its biggest company as miner BHP ditches its Anglo-Australian dual structure in favour of listing on Sydney’s stock market.
Today, L&G which owns a 1.9 per cent stake in the company, said that the news BHP will give up its listing is “disappointing.”
“Today’s announcement is very significant — with the likely outcome that BHP leaves UK indices,” Nick Stansbury, head of climate solutions at Legal & General Investment Management told The Times.
“If this is indeed the case for UK index investors, it is our view that losing a company of the calibre of BHP is disappointing,” he added.
BHP yesterday reported record financials for the the year ending on June 30 pulling in $25.9bn (£18.8bn) of profit from its operations, up from $14.4bn in 2020. Shareholders took home a bumper paycheck of $15bn between them.
Yesterday the second-largest FTSE100 company also announced it would exit the petroleum business through a merger with Australia’s Woodside Petroleum.
BHP Chair, Ken MacKenzie, said that the bluechip firm is undergoing a period of “rapid change” and growth. He said: “Now is the right time to unify BHP’s corporate structure. BHP will be simpler and more efficient, with greater flexibility to shape our portfolio for the future.”
Now that the company has offloaded the petroleum arm of its business, the company plans to enter the commodities trade. Executives today approved $5.7bn of expenditure in the Jansen Stage 1 potash project which will increase the company’s exposure to future facing commodities.
MacKenzie said that rejigging the structure of the company will provide “greater flexibility to shape our portfolio for the future.”
“Our plans announced today will better enable BHP to pursue opportunities in new and existing markets and create value and returns over generations,” he added.
The company’s share price is down 5.03 per cent in the past 24 hours.
Read more: BHP confirms Woodside merger, after shareholders bag $15bn payday