Advertisement

Shareholders back BHP split

BHP Billiton shareholder vote overwhelmingly in favour of demerger, which will create a multi-billion resource company headquartered in Perth. Picture: Lincoln Baker/The West Australian.

BHP Billiton shareholders have ticked off on the spin out of the company's second tier assets, voting overwhelmingly in favour of the creation of South32 at twin shareholder meetings in London and Perth this afternoon.

More than 97 per cent of votes were cast in favour of demerger, which will create a multi-billion resource company headquartered in Perth.

South32's assets will span the globe, and include Worsley alumina in the South West, the Cannington silver-lead-zinc mine in Queensland, coal in New South Wales and manganese in the Northern Territory, and South Africa. It also holds extensive coal assets in South Africa and aluminium projects in Brazil and Mozambique and the Cerro Matoso nickel mine in Colombia.

BHP chairman Jac Nasser told shareholders in Perth the demerger will create long-term value for BHP shareholders, who will receive shares in South32 when the spin-out is completed later this month.

South32 will trade on the Australian Securities Exchange, the London stock market and the Johannesburg stock exchange.

With an expected market capitalisation of more than $12 billion at its May 18 listing, South32 is likely to be WA's third largest ASX-listed company, behind only Wesfarmers and Woodside Petroleum.

Mr Nasser said the businesses contained in South32 generated pro-forma revenue of $US8.3 billion in 2014, and underlying earnings of $US446 million.

South32 will be led by former BHP chief financial officer Graham Kerr, with Lend Lease chairman David Crawford heading its board.

Mr Nasser said the demerger would also benefit BHP shareholders through the simplification of BHP's own business, as the company will be able to focus on its core assets in iron ore, oil and gas, copper, coal and potash.

He said BHP would not rebase its dividends following the demerger.

BHP shares closed down 21c to $32.35 yesterday.