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BHP Billiton share price: US shale business exit could take until 2019

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The planned exit of BHP Billiton (LON:BLT) from its US shale business might take until late this year or early next year, Reuters has reported. The Anglo-Australian miner has been looking to offload the business amid pressure from activist hedge fund Elliott Management which holds a stake in the blue-chip group.

BHP Billiton’s share price has been little changed in today’s session, having inched 0.01 percent lower to 1,730.60p as of 10:34 BST. The stock is marginally outperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.45 percent lower at 7,706.21 points.

US shale exit update

Sources with knowledge of the matter told Reuters that BHP’s planned exit from its shale business in the US had drawn oil companies and private equity firms into a competition which might have no clear winner until late this year or early next year. The Anglo-Australian company’s Houston-based BHP Petroleum unit holds more than 838,000 acres across four US shale plays, namely Texas’ Permian and Eagle Ford basins, and the Haynesville and Fayetteville formations of Arkansas.

The sources indicated to the newswire that while first bids were received last week, no deal is expected until very late in 2018 or early 2019. It remains unclear whether the FTSE 100 group will hold a second bid round with certain bidders or all of them or opt to continue weighing the received bids toward securing a preferred deal.

Analysts on BHP Billiton

Goldman Sachs, which sees the Anglo-Australian miner as a ‘buy,’ set a price target on the shares of 2,000p last week. According to MarketBeat, the FTSE 100 group currently has a consensus ‘hold’ rating and an average price target of 1,517.17p.

As of 10:51 BST, Tuesday, 05 June, BHP Billiton plc share price is 1,727.00p.

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