The BHP Billiton Limited (ASX: BHP) share price has retreated today even after the company launched its 'Think Big' brand campaign in Australia, which will involve a historic name change for the business.
Back to its roots
The Broken Hill Propriety Company, or BHP, was first formed in 1885 as a silver, lead and zinc mine. It added 'Billiton' to its name following the 2001 merger with the group, creating one of the largest and most diversified mining corporation in the world.
However, BHP Billiton essentially reversed the effects of that merger in May 2015 when it spun-off its 'non-core' assets to create South32 Ltd (ASX: S32), which now trades for around $2.64 on the ASX. In an announcement made by the company shortly after midnight, it said "in launching Think Big, we will take the opportunity to change our logo and move to a brand that Australians have known us by for generations".
In effect, the company will remove 'Billiton' from its name to become, more simply, BHP. It will also replace its "three blobs" logo as part of the $10 million campaign.
While getting back to its roots is one reason behind the company's decision to rebrand itself, it's likely the decision was also made in an attempt to regain the community's trust. Indeed, it's no secret that BHP has had a bad run when it comes to public relations over the past decade or so. Most recently the company's image was tarnished by the incident at the Samarco dam in Brazil, which tragically killed more than a dozen individuals. Prior to that, there was a corruption investigation surrounding hospitality provided at the Olympic Games in Beijing as well as a dispute with the Australian Taxation Office.
In its update this morning, the company also noted, "We fundamentally believe that as society changes it is up to us to make the case – more confidently and effectively – for the positive role that well-run and responsible companies play in society."
Foolish Takeaway
Although I like that BHP has refocused on its core operations, as well as cutting costs across its business, a successful investment in the company does remain dependent on the direction that commodity prices take from here.
The BHP Billiton share price started 2017 on a very positive note, soaring to a high of almost $28. However, the shares have since retreated to less than $24, and are down 0.4% today. Iron ore and oil prices have retreated, with some forecasts suggesting there is more pain to come. As such, investors should do their own due diligence in determining a fair price at which to buy BHP's shares, and perhaps remaining on the sidelines if there is any element of doubt. Besides, there are plenty of other great companies to choose from instead that aren't dependent on rising commodity prices.