Investing
Anglo to sell Australian coal mines to Peabody for up to $3.78 billion
Published by Jessica Weisman-Pitts
Posted on November 25, 2024
3 min readLast updated: January 28, 2026
Global Banking & Finance Review®
Company
Published by Jessica Weisman-Pitts
Posted on November 25, 2024
3 min readLast updated: January 28, 2026
By Clara Denina and Melanie Burton
LONDON/MELBOURNE (Reuters) – Anglo American agreed on Monday to sell its remaining Australian steelmaking coal mines to Peabody Energy for up to $3.78 billion in cash, the first major disposal in a wider restructuring plan.
The London-listed miner is reshaping its business to focus on copper after fending off a $49 billion takeover bid from larger rival BHP in May, betting on disposals to increase value and ward off unwanted suitors.
Anglo’s share price was up 2.4% by 0829 GMT.
Peabody’s deal comprises an upfront payment of $2.05 billion at completion, deferred cash consideration of $725 million and the potential for up to $550 million. It also includes a contingent cash consideration of $450 million linked to the reopening of the Grosvenor mine after a fire broke out there in June, Anglo American said in a statement.
Portfolio manager Ben Cleary at Tribeca Investment Partners, whose firm counts Anglo as its largest holding said that the miner received a “good price.
“A decent amount of cash and the deferred element seems sensible,” he added.
Peabody will buy Moranbah North, Grosvenor, Aquila, and Capcoal located in Australia’s Bowen Basin. Anglo’s Dawson mine will be sold on for $455 million to a unit of Indonesia’s Delta Dunia Group which runs the BUMA coal mining services business, in a back-to-back transaction, Peabody said.
The agreement comes just days before a six-month freeze on another approach by BHP expires on Friday under UK takeover regulations, after Anglo rebuffed BHP three times.
Anglo had already offloaded a minority stake in a joint venture that owns the Jellinbah East and Lake Vermont steelmaking coal mines in Australia, for $1.1 billion.
SPINNING OUT UNDERPERFORMING ASSETS
Anglo’s plan to restructure also includes shedding underperforming platinum, nickel and diamond assets to focus on copper, a metal key for the clean energy transition and the rapid expansion of artificial intelligence, iron ore and crop nutrients.
“We see potential for a material re-rating in the medium-term as Anglo delivers on its restructuring plan, leaving a simplified portfolio with a 60% exposure to copper,” said Marina Calero, an analyst at RBC Capital Markets.
“A renewed approach from BHP cannot be ruled out, with the end November deadline soon approaching,” she added.
After coal, Anglo is expected to spin out its Anglo American Platinum unit in South Africa by mid-2025. CEO Duncan Wanblad also said it expects diamond giant De Beers to follow, as the group works towards separation of that business.
We are well progressed with the delivery of $1 billion of cost savings,” he said in a press release.
(Reporting by Melanie Burton in Melbourne, Clara Denina in London and Aby Jose Koilparambil in Bengaluru; Editing by Sonali Paul, Rashmi Aich, Louise Heavens and Emelia Sithole-Matarise)
Restructuring in finance refers to the process of reorganizing a company's structure, operations, or finances to improve efficiency and profitability, often in response to financial challenges.
A coal mine is a site where coal is extracted from the ground. Coal is a fossil fuel used primarily for electricity generation and steel production.
Deferred cash consideration is a payment structure in which part of the purchase price is paid at a later date, often contingent on specific future events or performance.
A takeover bid is an offer made by an individual or company to purchase another company, often at a premium over the current market price.
Contingent cash consideration is a payment that is dependent on certain conditions being met, such as the performance of an asset or the occurrence of a specific event.
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