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BHP Billiton company information.
BHP Billiton is the world's largest primary resources company.
It was created in 2001 by the merger of Australia's Broken Hill
Proprietary Company and the UK's Billiton, which had a South African
background. The result is a dual-listed company.
Broken Hill Proprietary Company
The Broken Hill Proprietary Company or BHP was incorporated in 1885,
operating the silver and lead mine at Broken Hill in western New South
Wales.
In 1915, the company ventured into steel manufacturing, with
its operations based primarily in Newcastle, New South Wales. It is also
known by the nickname "the Big Australian".
The company began petroleum exploration in the 1960s with discoveries in
Bass Strait, an activity which became an increasing focus.
BHP began to diversify offshore in a variety of projects. One project
was the Ok Ted copper mine in Papua New Guinea, where the company was
successfully sued by the indigenous inhabitants because of the
environmental damage caused by the mine operations. BHP had better
success with the giant Escondido copper mine in Chile and
the Ekati Diamond Mine in northern Canada.
The inefficiencies of what was, by global standards, a small steel
operation in Newcastle finally caught up with the company and the
Newcastle operations were closed in 1999. The 'long products' side
of the steel business was spun off to form OneSteel in 2000.
In 2001, BHP merged with the Billiton mining company to form BHP
Billiton, the largest mining company in the world. In 2002, the 'flat
products' steel business was spun off to form BHP Steel. In 2003, BHP
Steel changed its name to Blue Scope Steel.
How Billiton Started?
Billiton was a mining company whose origins stretch back to 29 September
1860, when the articles of association were approved by a meeting of
shareholders in the Groot Keizerhof hotel in The Hague, Netherlands.
Two months later, the company acquired the mineral rights to tin-rich
islands of Banka and Billiton in the Indonesian archipelago, off the
eastern coast of Sumatra.
Billiton's initial business forays included tin and lead smelting in The
Netherlands, followed in the 1940s by bauxite mining in Indonesia and
Suriname. In 1970, Royal Dutch/Shell acquired Billiton and accelerated
the scope of progress of this growth. The tin and lead smelter in Arnhem, Netherlands was shut down in the 1980s.
In 1994 Gencor acquired the mining division of Billiton excluding the
downstream metal division.
Throughout the 1990s and beyond, Billiton Plc experienced considerable
growth. Its portfolio included aluminum smelters in South Africa and
Mozambique, nickel operations in Australia and Colombia, base metals
mines in South America, Canada and South Africa, coal mines in
Australia, Colombia and South Africa, as well as interests in operations
in Brazil, Suriname, Australia aluminum and South Africa titanium
minerals and steel and ferroalloys.
BHP Billiton Mergers and Acquisitions
In March 2005, BHP Billiton announced a $7.3 billion agreed bid for
another mining company WMC Resources, owners of the Olympic Dam uranium
mine in South Australia, nickel operations in Western Australia and
Queensland, and a fertilizer plant also in Queensland. The takeover
achieved 90% acceptance on 17 June 2005, and 100% ownership was
announced on 2 August 2005, achieved through compulsory acquisition of
the last 10 percent of the shares.
BHP Billiton announced it was seeking to purchase
rival mining group Rio Tinto Group in an all-share deal. The initial
offer of 3 shares of BHP Billiton stock for each share of Rio Tinto was
rejected by the board of Rio Tinto for "significantly undervaluing" the
company. It was unknown at the time if BHP Billiton would attempt to
purchase Rio Tinto through some form of hostile takeover; however,
CEO Marius Loppers met with many of Rio's shareholders since the
announcement and reiterated that the offer for Rio was "compelling" and
that BHP Billiton is very "patient." A formal hostile bid of 3.4 BHP Billiton shares for each Rio Tinto share was announced on February
6, 2008.
Operations for BHP
The company operates a wide variety of mining and processing operations
in 25 countries, employing approximately 38,000 people.
The company has nine primary operational units:
Iron ore
Manganese
Petroleum
Aluminum
Base Metals (primary products include copper, lead, zinc and uranium)
Metallurgical Coal
Thermal Coal
Stainless Steel Materials (nickel and cobalt)
Diamonds & Speciality Products (diamonds and titanium minerals)
Corporate structure of BHP billiton
The Australian BHP Billiton Limited and the British BHP Billiton Plc
list separately with separate shareholder bodies but they operate as one
business with identical boards of directors and a single management
structure. The headquarters are in Melbourne, Australia. The company has
other key offices in London, Perth, Johannesburg, Santiago, Singapore,
Shanghai, Houston and The Hague.
Management
After the merger between BHP and Billiton in 2001, Brian Gilbertson of
Billiton was appointed CEO. In 2003, after just six months at the helm,
he abruptly stepped down, citing irreconcilable differences with the
boards.
Upon Gilbertson's resignation, Chip Goodyear was announced as the new
CEO. He continued in that role until his retirement on September 30,
2007. Marius Kloppers is his immediate successor CEO.
Angola
Inclement weather caused a BHP Billiton helicopter to crash in Angola on
November 16, 2007, killing the helicopter's five passengers, including
BHP's chief operation officer in Angola, David Hop good. The helicopter
went down about 80 km/50 miles from Alto Cuilo Camp, a diamond mining
site the employees wanted to visit. BHP Billiton responded by suspending
operations in the country. The company is investigating the incident.