1.1.1 BHP Billiton Company Background
BHP Billiton Limited was founded in the year 2001 as a merger between Australian Broken Hill Proprietary Company and the Anglo-Dutch Billiton Plc. BHP Billiton is a dual listed company and well known as the leading global resources and the largest mining company in the world measured from its revenue. The headquarters is in Melbourne, Australia and a major management office in London, UK. They have more than 100,000 employees and contractors across the 25 nations. BHP Billiton is the major producers of commodities namely energy coal, aluminum, iron ore, minerals, copper, manganese, uranium, nickel, and mining in oil, gas, and diamond. They have more than 100 mining and processing operations across 25 countries.
In the mid year of 2010, BHP Billiton earn US$ 12.5 billion of total profit, US$ 165.6 billion in market capitalization and US$ 200.5 billion in community contributions. BHP Billiton Limited has a primary listing on the Australian Securities Exchange and is the largest companies in Australia measured from its market capitalization. Moreover, BHP Billiton Plc. has a premium listing on the London Stock Exchange. In addition, BHP Billiton has two American Depositary Receipt listings on the New York Stock Exchange. (IN TEXT REFERENCE, COPAST FROM WEBISTE).
Their current strategy remain unchanged since 2001 and commonly they focus on large, low cost, and high quality of assets which vary by its commodity, markets, and geographic. BHP Billiton has high values and corporate social responsibility. They put safety first, functionally excellence, high integrity, and prioritize its people. They operate their production safely and they believe that they are the businesses that have minimal injuries, fatalities or illnesses. It all succeeded due to a strong leadership that could handle and minimizes all the risks. Their operational systems are diversified geographically and commodity, which measures that they are the part of the local societies. Their main goal is to responsibly minimize the negative environmental and social impacts and to maximize the benefits towards each individual in the societies as their companies operate. Furthermore, this paper will analyze the current strategy used by BHP Billiton, critiques, and some recommendations.
1.1.2 BHP Billiton mergers and acquisitions
In 2005, BHP Billiton announced an acquisition with WMC resources companies with a bid of US$ 7.3 billion that owns the Olympic Dam copper, gold and uranium mine in South Australia, a fertilizer plant in Queensland, and also nickel uranium in Western Australia. Then, in the end of 2007, BHP Billiton tried to buy Rio Tinto Group their major rival in mining and the third largest iron ore producers in the world. The purpose is to accelerate their business growth and market capitalization in iron ore. BHP Billiton tried to buy Rio Tinto group in all share-deal with the bid of US$ 3.34 of each share of Rio Tinto group and it was rejected and considered as “undervaluing” the company. At last, in the end of year 2008 BHP Billiton withdraws the bid due to a global recession. Until recently, in year 2011, BHP Billiton successfully joint venture with Rio Tinto group in the iron ore production. It is the biggest joint venture ever in Australia and has been rumored for over a month by media. Lastly, in January 2010, BHP Billiton dealt with Athabasca Potash the potash producer for US$ 320 million agreement. It is expected to produce 15% of the world’s potash in year 2020.
2.1.1 BHP Billiton current marketing strategy
2.1.2 SWOT Analysis
Being the largest mining company in the world, BHP Billiton has an access in the global capital markets, has competitive market position, and the ability to grow in the market. Moreover, as a giant company in the mining industry, they have more benefits in term of providing good quality of...