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BHP Group Ltd ADR BHP

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Morningstar’s Analysis

Valuation
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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Shareholders Vote to Reunify BHP While Iron Ore Is Firing, AUD 39 FVE Retained.

Mathew Hodge, CFA Regional Director

Analyst Note

| Mathew Hodge, CFA |

Shareholders have approved the reunification of no-moat-rated BHP. The reunification vote will see the one for one exchange of the company’s BHP Plc shares for BHP Ltd shares and de-listing the Plc shares. The 40% of London-listed shares transferring to the ASX will see an approximate two thirds increase in BHP’s weighting in the key indexes. Unification allows BHP to reduce corporate costs while making some forms of corporate activity, such as the proposed merger of BHP Petroleum with Woodside easier. With the unification approved, a key potential hurdle for the BHP Petroleum/Woodside merger clears and we expect it to proceed.

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Company Profile

Business Description

BHP is a leading global diversified miner supplying iron ore, copper, oil, gas, and metallurgical. The merger of BHP Limited (now BHP Ltd.) and Billiton PLC (now BHP PLC) created the present-day BHP. Shareholders in each company have equivalent economic and voting rights in BHP as a whole and in 2022 voted to reunify the dual listed structure. Major assets include Pilbara iron ore, Queensland coking coal, Escondida copper and conventional petroleum assets, principally in Australia and the Gulf of Mexico. Onshore U.S. oil and gas assets were sold in 2018 and the remaining Petroleum assets are likely to be spun off and merged with Woodside.

Contact
171 Collins Street, Level 18
Melbourne, VIC, 3000, Australia
T +61 396093333
Sector Basic Materials
Industry Other Industrial Metals & Mining
Most Recent Earnings —
Fiscal Year End Jun 30, 2022
Stock Type —
Employees 34,478

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