Anglo American (AAL.L) has reached an agreement to sell a 33.3% stake in a joint venture that holds a 70% interest in the Jellinbah East and Lake Vermont steelmaking coal mines in Australia. The sale price is set at A$1.6 billion ($1.1 billion).
This deal initiates Anglo’s broader strategy to restructure its business. The need for such restructuring arose after the company fended off a $49 billion takeover bid from its larger rival, BHP Group (BHP.AX), back in May of this year.
In a statement on Monday, Anglo announced that it would sell one-third of Jellinbah Group, the operator of the Queensland-based mines, to Zashvin Ltd. Zashvin Ltd is an Australian electric power generation facility operator that already possesses a one-third interest in the mines.
CEO Duncan Wanblad stated in the announcement that Anglo has also progressed with the sale of the remaining steelmaking coal mines it owns in Australia and is on track to finalize the terms of these sales in the upcoming months.
The miner is actively engaged in selling its coking coal mines in Australia and nickel assets in Brazil. Additionally, it is in the process of spinning off its platinum mines in South Africa. Anglo is also considering whether to sell or separately list its De Beers diamonds unit as it redirects its focus towards copper, iron ore, and the fertiliser business.
Anglo’s world-class copper assets in Latin America have made it an attractive target for larger rivals who are looking to enhance their exposure to copper, an important metal for the green energy transition. The company has set an ambitious goal to increase copper output at its mines in Chile and Peru to approximately 1 million metric tons by 2030.
Last week, BHP did not rule out the possibility of renewing its pursuit of the London-listed miner. The six-month block on another approach is set to expire at the end of November.
As a result of these developments, Anglo shares in London witnessed an increase of as much as 2% during early morning trade.
Anglo American to Sell 33% Stake in Australian Steelmaking Coal Assets for $1.1 Billion in Business Restructuring Move