When a fire broke out at Anglo American’s Grosvenor steelmaking coal mine in Queensland, Australia, in June, it put some question marks over the sale of the London-listed group’s steelmaking coal business. This was one of the essentials of the “self-help” restructuring Anglo announced as it rebuffed the takeover bid by Australia’s BHP.
Now, as the six month “put up or shut up” period expires, raising the prospect of a further BHP bid, Anglo has shown it can sell its coal business for value, and is on the way to executing on that restructuring.
It is also adding sizeable chunks of cash to its balance sheet that start to position it for future growth.
Anglo earlier sold its Jellinbah steelmaking coal mines for about $1.1bn and this week announced it will sell the rest of the steelmaking coal business (Grosvenor included) to Peabody for $3.6bn. The next steps are to shed its platinum group metals, diamond and nickel businesses.
It has already made a start on selling down its controlling stake in Anglo American Platinum, placing shares worth about $400m on the market earlier this year, and is on track to unbundle the rest to Anglo shareholders.
This shouldn’t be too complicated: selling or unbundling unlisted De Beers could be a lot more so given that the Botswana government has a big stake and the diamond market remains weak. Still, the group seems set on meeting its end-2025 deadline to complete the restructuring process.
Whether BHP will bid now or wait for the restructuring to be further along is the question.
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