Anglo American on Monday said it would sell its remaining portfolio of steelmaking coal mines in Australia to Peabody Energy for up to US$3.775 billion in cash, as the mining giant has embarked on a major restructuring of its business.

With the deal announced today, Anglo American expects to generate up to US$4.9 billion in aggregate gross cash proceeds from its coal assets, including the already announced sale of Anglo American’s interest in Jellinbah for about US$1.1 billion.

After rejecting takeover offers from mining giant BHP, Anglo American said in May that it plans to divest or demerge its diamond, platinum, steelmaking coal, and nickel businesses as it seeks to radically simplify its portfolio to focus on its copper, premium iron ore, and crop nutrients assets.

Anglo American, which has been a target of three unsolicited takeover bids from BHP, is looking to unlock significant value from its portfolio and accelerate the delivery of “consistently stronger shareholder returns” via sales or demergers of Anglo American Platinum and the diamond business De Beers, as well as the nickel and steelmaking coal assets.

Commenting on the divestment strategy, Anglo American CEO Duncan Wanblad said on Monday, “All the transactions to deliver our portfolio transformation are well in train – the demerger of Anglo American Platinum is expected by mid-2025 and we have seen strong interest in our nickel business with the sale process well progressed.”

Anglo American expects the diamond business De Beers to follow.

“We are absolutely focused on delivering that strategy and unlocking the associated value as we streamline our cost structures and create a much simpler, more resilient and more agile business that will enable full market value recognition,” Wanblad said in a statement.

The sale of Anglo American’s Australian coal business to Peabody comes just days before a six-month freeze on another approach by BHP expires at the end of this week under UK takeover regulations.

By Tsvetana Paraskova for Oilprice.com

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