Anglo American Weighs Options for Coal Business Sale Amid Mine Explosion Setback
Anglo American is exploring options to proceed with the sale of its coal business following an explosion at its flagship Australian mine. The company may consider selling individual assets or excluding the damaged operation from a potential deal.
This sale is part of a significant restructuring program announced earlier this year by Anglo American as the London-based miner sought to fend off a takeover bid by larger rival BHP Group.
The company also plans to spin off its platinum unit and either sell or separate diamond miner De Beers. Initially, the coal sale was viewed as the most achievable part of the restructuring.
Anglo had already received interest in the coal assets, and a deal for the lucrative coking coal mines in Australia would have demonstrated early progress to investors, proving that Anglo’s independent strategy offered better value than BHP’s rejected bid.
However, the plan faced uncertainty after a methane explosion deep underground started a massive fire at Anglo’s Grosvenor coal mine in Queensland. It will likely take several months before the company can safely re-enter the mine and resume mining operations.
Despite the setback, Anglo is determined to continue the sales process due to the strong early interest it received in the mines. Before the accident, the company had planned to initiate the sales process in the coming months, aiming for a deal by the end of the year.
Anglo may now consider selling the rest of the coal business without Grosvenor or selling the other mines individually. Although excluding Grosvenor from the sale would lower the overall price, Anglo is keen to move forward and show progress after its board unanimously rejected BHP’s approach in May. BHP is currently restricted from making a fresh bid for Anglo, but this regulatory standstill will expire later this year.
A spokesperson for Anglo declined to comment.
In addition to selling its coal business, Anglo is also working on plans to spin off its majority stake in Anglo American Platinum Ltd. and exit its ownership of De Beers.
The company prefers to wait for a recovery in the diamond market, believing that De Beers should command a price reflecting its status as a premium asset.
SOURCE:miningweekly.com
