Australian fund manager AMP Capital wants an independent review conducted on New York-based Elliott Management Corp.'s plan for BHP Billiton Group to drop its dual-listed structure, The Australian reported June 10, citing a letter to institutional clients.
"Elliott claims the [dual-listed company] structure can be changed for US$200 million," AMP said in the letter.
"BHP disagrees, telling us it's impossible, illegal and would result in a big tax bill ... as outsiders we simply do not know the answer. If the answer is unclear, why not allow an independent assessment of the legality and cost effectiveness of the Elliott [dual-listed company] proposal?"
AMP, which has about A$120 billion worth of funds under management and is BHP Billiton's largest shareholder in Australia, also wants the mining heavyweight to provide more detail around its plan for its US$22 billion U.S. shale business, which Elliott wants to be spun out into a separate company.
"If both BHP and Elliott can address the future of the company's oil and gas business and [dual-listed company structure] in an open and honest manner, AMP Capital believes it will result in the best results for all shareholders now and into the future," AMP was quoted as saying.
The fund manager has reportedly raised the issues with both BHP Billiton and Elliott.
Since Elliott launched its attack on BHP Billiton, Sydney's Tribeca Global Natural Resources Fund and Melbourne, Australia-based Escala Partners have called for board changes and a review of the petroleum business.
AMP wants BHP Billiton to "prove the worth" of its U.S. onshore business and demonstrate its compatibility in the miner's portfolio, according to The Australian.
The fund manager also suggested BHP Billiton have a "plan B" for its U.S. assets if oil and gas prices remain low.
AMP, however, wants Elliott to give the company breathing room to put forward its case for keeping the assets and time to meet targets.