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BHP backs out of bidding war with Australian billionaire

By Debabrata Das

02:51, 22 December 2021

Image of a nickel mine
BHP’s decision not to match Wyloo Metals’ bid for Noront Resources ends an almost six-month long tussle for the North American company – Photo: Shutterstock

Anglo-Australian miner BHP will not match Australian billionaire Andrew Forrest’s Wyloo Metals bid for Canadian miner Noront Resources, ending an almost six-month long tussle for the North American company.

BHP had started the battle with Wyloo Metals when it made its initial bid of CAD0.55 per stock for Noront Resources in July. Following a counter bid Wyloo Metals, BHP raised its offer in October and even entered into talks with Wyloo Metals for its support. However, last week’s talks between the two ended and Wyloo Metals increased its offer to CAD1.10 per stock for Noront Resources.

“BHP is committed to its strict capital discipline framework. While the Eagle’s Nest deposit is a promising resource, we do not see adequate long-term value for BHP shareholders to support an increase in BHP’s offer in order to match the CAD1.10 per share proposal from Wyloo Metals,” BHP chief development officer, Johan van Jaarsveld, said in a statement on Tuesday.


38,882.05 Price
+0.080% 1D Chg, %
Long position overnight fee -0.0616%
Short position overnight fee 0.0137%
Overnight fee time 22:00 (UTC)
Spread 106.00


0.62 Price
+0.410% 1D Chg, %
Long position overnight fee -0.0753%
Short position overnight fee 0.0069%
Overnight fee time 22:00 (UTC)
Spread 0.01168

Oil - Crude

74.50 Price
-1.560% 1D Chg, %
Long position overnight fee -0.0136%
Short position overnight fee -0.0083%
Overnight fee time 22:00 (UTC)
Spread 0.040


16,001.20 Price
+0.470% 1D Chg, %
Long position overnight fee -0.0262%
Short position overnight fee 0.0040%
Overnight fee time 22:00 (UTC)
Spread 7.0

BHP’s stock price falls

BHP’s announcement came a day after Noront Resources announced that its board will recommend Wyloo’s bid.

“This is an exciting time to be an investor in future facing metal projects. Battery and hydrogen technologies are unleashing the full potential of renewable energy and the supply of critical metals simply isn’t keeping up. This is the greatest shift in the global economy since the industrial revolution,” Luca Giacovazzi, head of Wyloo Metals, said regarding the motivation behind bidding for Noront Resources.

Wyloo Metals is already a 37.2% stockholder of Noront and expects to complete the acquisition by March/April 2022. Following the announcement, BHP’s stock price on the Australian Securities Exchange was trading 0.98% lower during morning trading in Sydney.

Read more: BHP ends talks for Wyloo support of Noront (NOT) takeover

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The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
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