Anglo American has agreed to the sale of its minority interest in steelmaking coal miner Jellinbah, which owns the Jellinbah East and Lake Vermont mines in Australia.
While Anglo does not operate the mines or market any of their production volumes, the disposal of Jellinbah reflects the group’s ongoing effort to simplify its portfolio by divesting of its steelmaking coal, diamonds and platinum group metals (PGM) businesses.
The A$1.6bn (R18.49bn) cash transaction will see Anglo’s 33.3% stake in Jellinbah going to existing shareholder Zashvin, who already owns one third of the Jellinbah’s shares, alongside Japanese trading company Marubeni.
Anglo CEO Duncan Wanblad said: “We are delighted to have agreed terms with our JV partner, Zashvin, for the sale of our minority interest in Jellinbah,” adding that the cash proceeds of A$1.6bn reflect the “exceptional quality of the Jellinbah business”.
Anglo’s stake in Jellinbah contributed $354m to group revenue in the first half of this year and $779 last year, while adding $153m and $373m to underlying ebitda in the first half of this year and last year, respectively.
“Jellinbah’s success has been driven by robust partnerships,” said Zashvin’s James Xu, adding that: “We’re appreciative of Anglo’s significant role in this journey and we value its dedication to making this transaction smooth and efficient.
“As a family that’s been with Jellinbah since its inception, our increased investment not only reflects our confidence in Queensland’s coal industry but also our commitment to supporting the central Queensland community.”
Subject to regulatory approval, the transaction is expected to be completed in the second quarter of next year — with Anglo now focused on reaching an agreement to sell the rest of its steelmaking coal business in the coming months.
Wanblad said the process to sell Anglo’s Australian steelmaking coal portfolio — including the flagship Moranbah North and Grosvenor assets — was “at an advanced stage”, reiterating that the group was “on track to agree terms in the coming months”.
“We are making excellent progress with our simplification of Anglo to create an exciting and differentiated investment proposition focused on our world-class copper, premium iron ore and crop nutrients assets — all future-enabling products,” said Wanblad.
“This highly cash generative and much higher margin portfolio will offer greater resilience through cycles and the benefit of significant high quality and well sequenced growth options, including a clear path to increase annual copper production to more than one million tonnes by the early 2030s.”
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