Elliott has put BHP on the defensive, and that’s a good thing
The mining giant may have rejected the fund manager’s proposal, but it is being forced to explain itself more, writes Clyde Russell
Launceston — Hedge fund Elliott Management is probably about half way to achieving its goal of extracting better returns out of BHP, the world’s largest mining company. It is not so important to focus on the nitty-gritty details of the activist investor’s proposals on how BHP should hive off its petroleum arm and consolidate its dual-listed structure. What does matter is the fact that Elliott, since it went public on April 10, has managed to put pressure on BHP’s management and board to do more in the name of shareholder value. It was always likely that BHP’s leaders would reject Elliott’s plan, and so it proved as the company said it would cost too much to implement and would not deliver Elliott’s expected benefits. But since then BHP has been forced into the somewhat uncomfortable position of having to explain its plans and set forth a vision of how the company will lift its returns to its owners. BHP CE Andrew Mackenzie, speaking to an audience of bankers and investors in Barcelo...
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