BHP's (NYSE:BHP) shareholders anticipate one final bid enhancement in the ongoing pursuit of Anglo American (OTC:AAUKF), as the regulatory deadline looms. So far, Anglo American rejected two successive all-share propositions, opting instead for an expedited restructuring initiative that would see it focus on copper and iron ore.

Anglo's refusal of BHP's all-share offers, which included spinning off listed South African businesses, has led to skepticism among investors. Despite Anglo's strategic moves, its shares continue to trade below the latest implied bid price per share, signaling doubt within the market.

Anonymous sources from both BHP and Anglo American, spoke with Bloomberg, expressing confidence in the likelihood of a third bid before the May 22 deadline. Analysts seem to agree with this assessment.

"I reckon they'll go back to Anglo and say – look, we're going to come back with 5% more," stated Daniel Sullivan, head of global natural resources at Janus Henderson, reflecting the sentiment among shareholders anticipating further negotiations, as he told Bloomberg.

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Morningstar's analyst Jon Mills highlighted the importance for BHP to sway Anglo's institutional shareholders.

"At this stage, I think it is up to BHP to try to convince enough of Anglo's institutional shareholders over the coming week that it's worthwhile pressuring their board to engage with BHP, with a potentially even higher offer on the table should this occur," he stated in a note.

Under UK regulations, if BHP fails to submit a binding bid by May 22, it will be compelled to step back for at least six months. The company's strategic choices include enhancing the share ratio, injecting cash into the offer, or a combination of both approaches.

BHP's CEO, Mike Henry, has been actively advocating for the deal, emphasizing the potential benefits to investors. However, Anglo's steadfast resistance and the complexity of the proposed restructuring pose significant challenges.

The possibility of a hostile bid remains on the table, although sources familiar with the matter suggest that BHP is hesitant due to regulatory concerns and the need for cooperation from Anglo's management. Additionally, BHP is unwavering in its insistence on Anglo demerging certain South African businesses, further complicating the negotiation landscape.

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