Anglo American exits the steelmaking coal business with an asset sale for $3.9 billion

Anglo American has agreed to sell the rest of its steelmaking coal operations for up to $3.9bn (£3bn).

The group is undergoing a radical overhaul after fighting off takeover attempts, with plans to sell its nickel, coal, De Beers diamond and platinum businesses within two years.

This follows the mining giant’s decision to sell its stake in Jellinbah Group, which owns 70 per cent of the Jellinbah East and Lake Vermont coal mines in Australia, to Zashvin for £810 million.

It now intends to sell the rest of the portfolio to Peabody Energy, a coal mining company based in St. Louis, Missouri, for $2.05 billion upfront and a deferred payment of $725 million.

Assets Peabody will gain as part of the deal include Anglo’s majority stakes in the Moranbah North, Roper Creek and Capcoal joint ventures, as well as its 50 per cent stake in the Theodore South joint venture.

Peabody has also agreed to pay potentially $550 million in quarterly price-linked “profits” and another $450 million if the Grosvenor mine in central Queensland is reopened.

Production at Grosvenor has been suspended since late June following a fire caused by the ignition of methane gas. No workers were injured in the accident.

Jim Grech, President and CEO of Peabody, said: “We are pleased to acquire these world-class assets from Anglo American, a company that shares our strong values ​​of safety, sustainability and social license to operate.”

“We look forward to integrating these assets, partnering with their highly skilled workforce and aligning with our new mining joint venture partners to create long-term value.”

Anglo announced plans for a radical overhaul in May in response to a successful takeover attempt by rival mining giant BHP.

The FTSE 100 group received three bids from BHP, with the third and final bid valued at a whopping £39bn.

If accepted, the acquisition would have been the largest ever in the history of the mining sector, but BHP pulled out mainly over fears that the deal would require Anglo to spin off its operations in South Africa.

In addition to its steelmaking coal segment, Anglo intends to sell or spin off its subsidiaries Anglo American Platinum and De Beers Diamond.

The company, the world’s largest platinum producer, said this would allow it to focus on the production of copper, premium iron ore and crop nutrients.

Copper is considered a vital element in the green transition due to its use in technologies such as solar panels and wind turbines.

“We are absolutely focused on implementing that strategy and unlocking the associated value as we rationalize our cost structures and create a much simpler, more resilient and more agile business,” said Duncan Wanblad, chief executive of Anglo American.

“All transactions to achieve the transformation of our portfolio are underway,” he added, with the spin-off of Anglo American Platinum expected in the middle of next year.

Anglo-American stocks They rose 1.5 per cent to 2,393.5 pence on Monday morning, taking their gains since the start of the year to around 22 per cent.