Finance

Mining giant BHP chooses Sydney over London for main stock listing

Mining giant BHP, one of the largest companies in the FTSE 100 said it will drop London in favour of Sydney as the main location for the listing of its shares.

BHP unveiled the move on 17 August, saying it would unify its corporate structure under its existing Australian parent company. However, the company will maintain a listing on the London Stock Exchange, as well on the Johannesburg and New York stock exchanges.

The world’s biggest mining company by market value noted net profit of $11.3bn in the year to June, up from a profit of $7.96bn in the same period a year earlier.

US-listed shares of BHP Group diverged on the news — BHP Group Ltd fell 4%, while BHP Group PLC  rallied 6%, MarketWatch reported. Plc shareholders’ shares will be exchanged for Limited shares on a one-for-one basis, the company said.

Ditching London as the main venue for its shares comes amid proposals that seek to bolster the UK as a destination for stock market listings.

In a review published in March this year, Lord Hill suggested an overhaul of the UK’s listing regime to make the country a more attractive destination for initial public offerings, including barriers preventing special purpose acquisition companies looking towards London.

READ FCA looks to open listing rules again in post-Brexit battle for IPOs

BHP said the change — due to be implemented in the first half of 2022 — would result in a corporate structure “that is simpler and more efficient, reduce duplication and streamline our governance and internal processes”.

“Now is the right time to unify BHP’s corporate structure,” said Ken MacKenzie, chair of BHP.

“BHP will be simpler and more efficient, with greater flexibility to shape our portfolio for the future. Our plans announced today will better enable BHP to pursue opportunities in new and existing markets and create value and returns over generations.”

The change coincided with BHP’s annual results and an announcement that it will merge its oil and gas business with Woodside Petroleum.

To contact the author of this story with feedback or news, email David Ricketts

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