Bhp Group Ltd · ASX:BHP
Bhp — RIO Tinto — Merger or Acquisition (July 2008)
24 slides from Bhp's merger presentation, Jul 7, 2008
Slide 1: Mr Don Argus AO Chairman, BHP Billiton
Mr Don Argus AO Chairman, BHP Billiton
Slide 2: Disclaimer
Disclaimer Slide By reviewing/attending this presentation you agree to be bound by the following conditions. The directors of BHP Billiton Limited and BHP Billiton Plc (“BHP Billiton") accept responsibility for the information contained in this presentation. Having taken all reasonable care to ensur
Slide 3: Disclaimer (continued)
Disclaimer (continued) Slide Information Relating to the US Offer for Rio Tinto plc BHP Billiton plans to register the offer and sale of securities it would issue to Rio Tinto plc US shareholders and Rio Tinto plc ADS holders by filing with the SEC a Registration Statement ( the “Registration Statem
Slide 4: Today's discussion
Today’s discussion Slide • Introduction • BHP Billiton – yesterday, today and tomorrow • Summary of the offer for Rio Tinto
Slide 5: Introduction
Introduction Slide • Joined the board November 1996, Chairman April 1999 • Chairman of BHP Billiton Limited and BHP Billiton Plc since formation • Market capitalisation rown from ~US$31bn in 2001 to ~US$220bn in 2008 • Four CEOs in that period – Paul Anderson – Brian Gilbertson – Chip Goodyear – Mar
Slide 6: Today's discussion
Today’s discussion Slide • Introduction • BHP Billiton – yesterday, today and tomorrow • Summary of the offer for Rio Tinto
Slide 7: BHP Billiton's track record in production growth and value growth speaks for itself
BHP Billiton’s track record in production growth and value growth speaks for itself Slide FY01 FY02 FY03 FY04 FY05 FY06 FY07 BHP Billiton 8% CAGR Rio Tinto 4% CAGR Notes: a) Source: Rio Tinto production numbers sourced from 2006 Annual and 2007 Half-Year Reports. Note: Production shown for the compa
Slide 8: A record of growth driven from a unique diversified portfolio, balanced across high margin commodities
A record of growth driven from a unique diversified portfolio, balanced across high margin commodities… Slide Underlying EBITDA (12 months, US$bn) Underlying EBITDA margin (a) (CY2007, 12 months) Note: Historical financial information has been restated for comparative purposes per note 1 of BHP Bill
Slide 9: … which generates strong cash flow - delivering value growth through reinvestment and return to shareholders
… which generates strong cash flow - delivering value growth through reinvestment and return to shareholders Slide 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 H1 H2 1,500 3,000 4,500 6,000 7,500 9,000 FY2002 FY2003 FY2004 FY2005 FY2006
Slide 10: China's urban population is on track to reach one billion
China’s urban population is on track to reach one billion 143 157 149 232 160 315 86 102 34 120 5 50,000 40 billion 170 5 billion 221 Slide China population by city size (Millions of people) 2005 2025 Big town (<0.5m) Small (0.5m–1.5m) Midsized (1.5m–5m) Big (5m–10m) Mega (10m+) Source: McKinsey Glo
Slide 11: Industrialisation and urbanisation in China have a long way to go
Industrialisation and urbanisation in China have a long way to go … Slide China’s tiered city structure 2005 2010 2020 84 tier 1-3 cities (a) 106 tier 1-3 cities (b) 143 tier 1-3 cities (c) Tier 1 Tier 2 Tier 3 Source: Global Insight; National Bureau of Statistics of China – China Statistical Yearbo
Slide 12: Chinese, not US, growth driving global metals demand over the past 10 years
… with Chinese, not US, growth driving global metals demand over the past 10 years China USA Slide 1,000 1,200 1,400 1997 2007 Copper consumption (kt) Nickel consumption (kt) Seaborne iron ore (mt) Energy consumption (mtoe) Other Notes: Seaborne iron ore demand based on import statistics - CRU data
Slide 13: Steel is an essential input as nations industrialise and urbanise
Steel is an essential input as nations industrialise and urbanise Slide Finished steel consumption (kg/capita) Source: World Bank; Government Statistics for Taiwan; IISI — 1,000 1,250 5,000 10,000 15,000 20,000 25,000 30,000 GDP/Capita (Jan-2008 Constant US Dollars) China India Japan Korea, Rep. Tai
Slide 14: bhpbilliton
bhpbilliton ‘ing the future
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Slide 18: …and has created considerable wealth for global investors so far…
…and has created considerable wealth for global investors so far… Slide BHP Billiton Plc (a) (GBP) Source: Bloomberg, Datastream as at 26-Jun-2008 a) Dividends/distributions assumes that the dividends are received in cash and reinvested in BHP Billiton. Includes the value of bonus shares distributed
Slide 19: Our message to BHP Billiton shareholders
Our message to BHP Billiton shareholders Slide • BHP Billiton is a strong company today and will be with or without Rio Tinto – A superior track record of delivering shareholder value – A deep and diversified portfolio of resources assets – Excellent management of those assets – Genuinely global ope
Slide 20: Today's discussion
Today’s discussion Slide • Introduction • BHP Billiton – yesterday, today and tomorrow • Summary of the offer for Rio Tinto
Slide 21: Offer for Rio Tinto – A compelling combination
Offer for Rio Tinto – A compelling combination 2 3 1 Slide Optimising mineral basin positions and infrastructure – Lower cost, more efficient production – Unlocking volume through matching reserves with infrastructure Enhanced platform for future growth – Deployment of scarce resources to highest va
Slide 22: Offer for Rio Tinto – Compelling terms
Offer for Rio Tinto – Compelling terms Slide 2.2 for 1 2.4 for 1 2.6 for 1 2.8 for 1 3.0 for 1 3.2 for 1 3.4 for 1 3.6 for 1 3.8 for 1 12-Jul-2007 07-Sep-2007 05-Nov-2007 01-Jan-2008 27-Feb-2008 24-Apr-2008 20-Jun-2008 Pre approach fair value exchange ratio 12-Nov-2007 BHP Billiton Proposal 06-Feb-2
Slide 23: Legitimate questions for Rio Tinto shareholders
Legitimate questions for Rio Tinto shareholders Slide • Assuming a satisfactory regulatory outcome, Rio Tinto shareholders will be faced with 2 choices: – Accept BHP Billiton’s offer, which is priced at a 45% premium to the pre- approach trading valuations of the two companies; or – Reject BHP Billi
Slide 24: bhpbilliton resourcing the future
cdl bhpbilliton resourcing the future