Potential Private-Equity Bid for BHP Billiton

In 2005, when I constructed the Big-Build Out (BBO) portfolio I imagined that there would be turn-over due to mergers and acquisitions.  However, never in my wildest dreams did I envision the world’s largest mining company, BHP Billiton, as a target.  Acquirer yes.  Target no way! That just demonstrates how much money is sloshing around looking for a home.

If you are not familiar with theory behind the BBO take look at its backgrounder.  The portfolio is up over 25% year to date.

Here is the current BBO roster:

• Alcan (AL)
• BHP Billiton (BHP)
• Bucyrus International (BUCY)
• Caterpillar (CAT) 
• Chicago Bridge and Iron Company (CBI)  *
• Companhia Vale Do Rio Doce (RIO) 
• Freeport-McMoran (FCX)
• Lundin Mining (LMC) 
• Southern Copper (PCU)
• Rio Tinto (RTP)
• Teck Cominco (TCK)
• Terex Corp (TEX). 

* Chicago Bridge and Iron Company replaced Phelps-Dodge on March 30th upon completion of FCX / PD merger; discussed here.

Merrill Lynch suggests private-equity BHP bid