South32 demerger approved

BHP Billiton shareholders have overwhelmingly supported the demerger and the creation of South32 by default. Via the IR page: Shareholder support for demerger of South32 by BHP Billiton. Shareholders voted 98.05 percent in favour of the deal. When is this going to happen then? Very, very soon. 18 May soon, which is not next Monday, rather the Monday thereafter. Yesterday was also the BHP Billiton General Meeting, chair Jac Nasser was speaking from Perth, here are a few extracts:

"There are very few companies that have prospered for over 100 years. By repeatedly reshaping itself, your company has evolved to become one of the world's largest companies and a leader in resources. We know you expect BHP Billiton to be strong and resilient; a company that delivers sustainable long-term value through economic and commodity cycles."


And then about the demerger, and what it means for the BHP we know:


"The demerger of South32 simplifies BHP Billiton's portfolio, while retaining the benefits of scale and diversification. We have 41 assets today, which would be reduced to a core portfolio of 19. The demerger enables us to focus on our petroleum, copper, iron ore, coal and potash assets, which together generated 96 per cent of the Group's Underlying Earnings Before Interest and Tax in the 2014 financial year. Our large, long life assets have delivered strong growth for shareholders over the last ten years."


South32 will be a company with multiple assets and not really that profitable when compared to the old big daddy, not that the new team, led by Graham Kerr cannot change that. Old time South African mining personality, Keith Rumble, who used to run Impala Platinum for a period of five years plus, was present in London. For South32, being able to focus on assets that previously were non core does give Kerr more flexibility. These assets ARE the core of South32, they will see them as such, not like an older head office. They are everything to the new team, we wish them well. There you go, in a couple of weeks time, you will get 1 South32 share for each 1 BHP Billiton share that you held on the 15th of May, close of business. That is the last day to trade. We will revert with a little more, post the demerger and "what to do" regarding the new shares.