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Picture: REUTERS/ARND WIEGMAN
Picture: REUTERS/ARND WIEGMAN

The recent BHP-Anglo American $49bn takeover saga has been a spectacle of strategic posturing. But as the dust settles on BHP’s retreat, a new opportunity arises for Glencore, a company that has been quietly but handsomely profiting in the fulcrum of the global energy transition.  

With BHP now sidelined by UK takeover rules, unable to make another approach to Anglo for six months, Glencore finds itself in an enviable position to make its move. The $70bn-plus mining giant had been weighing whether to put in a competing bid for Anglo, according to a Reuters report citing unnamed sources.

Glencore’s interest, if true, isn’t just about expanding its portfolio; it’s a calculated move in the global energy transition chess game. Adding Anglo’s coveted copper businesses to its portfolio would bump up Glencore’s copper output to nearly 2-million tonnes and appease restless shareholders such as BlackRock, which have been pressing the company to demonstrate its commitment to reduce carbon emissions and play a bigger role in the global energy transition.   

Copper is a crucial metal for the transition. It is used in everything from electric vehicles and power grids to construction, and demand is expected to rise as the world moves to cleaner energy and wider use of artificial intelligence. Boosting its exposure to this metal would set Glencore apart from its competitors, some of which are trading at a premium to Glencore. 

But let’s not kid ourselves: a Glencore play for Anglo isn’t going to be a walk in the park. Glencore has to come in with a deal that’s sweet enough to get Anglo shareholders on board but sharp enough to keep regulators nodding along. It’s a delicate balance.  

Still, Glencore has a lot going for it, were it to make it an approach. For one thing,  it has established links in SA and its potential interest in the country’s iron ore assets, which were unwanted by BHP, could make it a more suitable partner for Anglo.

For another, the failed BHP-Anglo deal has laid bare the strategies and ambitions of both companies. Now it falls to Gary Nagle, Glencore’s boss, to craft a proposal that eschews the complexities and execution risks that undermined BHP’s bid. This proposal must be compelling enough to sway shareholders who buy into the promise of Anglo’s vision for a chance to run with the wind, chase the setting sun and discover what lies beyond the edge.

And with a poor track record in mergers & acquisitions (M&A), it’s not unreasonable to assume that Rio Tinto would sit this one out. Analysts estimate that the company has had to write off a staggering $54bn from its balance sheet thanks to missteps in its deal-making dating back to 2007.   

So, what is the bottom line? With BHP out of the running for at least six months, and Jakob Stausholm, Rio Tinto’s boss, unlikely to expose himself to a poor M&A record and the wrath of shareholders, Glencore has a golden opportunity to make its mark. The next six months will be crucial, and all eyes are on Glencore. Will it step up and seal the deal? Only time will tell, but one thing is not in doubt: the story did not end last week. 

• Motsoeneng is Business Day deputy editor.

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