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The company is ranked as the third largest mining firm globally according to revenue and market capitalization. BHP Billiton was established in through the merger of two small companies: History Billiton was a mining company established in as a firm that mined lead and tin and later on, bauxite.
Billiton was acquired by Shell in that accelerated the pace of growth of the company. The Broken Hill Proprietary Company was established in and mined silver and lead. Later in the 19th century, the company shifted into steel manufacturing in Wales.
After amassing wealth, the company shifted into petroleum exploration in the Bass Strait, later on dropped other investments, and focused squarely on petroleum.
Various mergers and acquisitions have occurred between and that made the BHP Billiton a dominant force in the Australian mining industry. By the second quarter of the financial year, the price had dropped to 1, before picking up in the third quarter to 2, As of 28 Novemberthe share price was at 1, pence, the company was forecasting a dividend yield of 3.
The specific market price for each of the products is difficult to estimate because of the wide range of products as well as their diversity. The company also receives returns that are categorized in different currencies making it difficult to quantify. One of their offices in the US is located in Fayetteville where they deal in onshore natural gas production while the other office is in the Gulf of Mexico that deals in natural gas and offshore Irish Sea oil.
BHP has invested a lot of capital in exploration and infrastructure projects in regions where there is high risk of political instability for instance Kazakhstan, Democratic Republic of Congo, Mongolia and Western Africa.
The most common political risks of operating in the mentioned volatile regions include nationalization by liberal leaders, civil unrest, changes in government policy, lease agreements, nullification of existing contracts and terrorism among other issues. An example of the effect of policy changes was the implementation of the Mineral and Petroleum Resources Development Act of that caused BHP mining department many losses.
These fluctuations could negatively affect the company growth plans, expansion projects and company income. The company relies on the current strength in worldwide commodities prices that are linked to the health of the global economy. The company is vulnerable to unpredictable currency assessments and common economic perils in the global industrial economies Permatasari, These features demand that the company support neighboring communities financially and supply resources for infrastructure such as housing, roads and schools.
New mining and infrastructure projects often need tailor-made approvals that can increase the development costs and lower profitability. The firm has taken measures to build on its status in Chile by concentrating on changing the worker conditions and the quality of life in the neighboring city of Antofagasta Hargreaves, Technology Factors BHP mainly relies on the technical elements of resourceful mining, exploration and unearthing of mining and energy possessions.
The company depends greatly on the use of technology inventions for the discovery and exploration of mineral and energy resources.
The investment in technology is therefore a fundamental expense for the BHP Billiton. The investment in the proper technological resources will affect two significant strategic drivers for the company: The major part of the technological infrastructure includes earth-moving machinery, trucks, cranes, concrete mixers, refineries and other machinery.
The company is one of the biggest traders of uranium after Olympic Dam Mine Australiasilver, copper and lead after Cannington Mine.Completing a PESTLE analysis may be a straightforward or intricate course of action. Overall, it is a quality tool that holds value for the managers of today.
In the s a corporate charge of the media created a great deal of concern. The VRIO Analysis Cover Up. Bhp BillitonS $40 Billion Hostile Bid For Potash Corp Case Study Solution.
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Announces Licensing Deal With Roma. PEST analysis of BHP Billiton Political factors BHP Billiton is a worldwide resources company that is vulnerable to political risk factors in almost all markets. BHP Billiton Ltd. (SWOT Analysis) - YouSigma. BHP Billiton Group (BHP Billiton) is a diversified natural resources group engaged in mineral exploration and production.
Sep 13, · It is a rare corporate love-in. The Potash Corporation of Saskatchewan and Agrium, a fertilizer company, have agreed to a merger of equals worth $36 billion in enterprise value.
Transcript of Business Strategy of BHP Billiton. Business Strategy of BHP Billiton Contents 1. Introduction 2.
Strategic Analysis External Analysis PESTEL Model Turbulence Model 1. Complexity Economic: Inflation, interest, declining commodity demand Horizontal integration into the potash and shale % equity in the Jansen Potash.