Anglo American (LSE:AAL) has agreed to sell its portfolio of steelmaking coal mines in Australia to privately held Dhilmar for up to US$3.875 billion ($5.42 billion).
The total consideration comprises an upfront cash payment of US$2.3 billion, as well as a price-linked earn-out of up to US$1.575 billion. Anglo American intends to use the funds to reduce net debt.
The deal is expected to be completed in Q1 2027.
Anglo American’s steelmaking coal portfolio comprises an 88% interest in the Moranbah North and Grosvenor joint venture projects, a 70% interest in the Capcoal joint venture, an 86.36% interest in the Roper Creek joint venture, a 51% interest in the Dawson, Dawson South, and Dawson South Exploration joint ventures, as well as the Theodore South joint venture, and a 50% interest in the Moranbah South joint venture.
In parallel with the transaction, the company continues to pursue the arbitration with Peabody in relation to its November 2024 agreement to acquire the coal mines portfolio.
Anglo American says it is confident that the incident at Moranbah North relied upon by Peabody in support of its purported termination of the agreement did not constitute a material adverse change.
CEO Duncan Wanblad says the deal is considered a testament to the high quality of these assets.
“Dhilmar’s leadership brings considerable experience of operating major mining assets, including in steelmaking coal, in Southeast Asia and Canada,” Wanblad says.
“We will work together with the Dhilmar team and with our workforce, local communities, government, customers, and partners to ensure a successful transition.
“This agreement represents another major step in the simplification of our portfolio ahead of completing our merger with Teck. Through this transaction, we will complete our exit from steelmaking coal, delivering aggregate cash proceeds of up to US$4.9 billion, given the prior completion of the sale of our interest in the Jellinbah mine for approximately US$1 billion.”
The transaction is subject to numerous conditions including customary completion and regulatory clearances, as well as pre-emption agreements.
Dhilmar is a UK-registered mining company focused on operations and investments in established mining jurisdictions across a range of commodities.
Anglo American is a global miner focused on producing copper, premium iron ore, and crop nutrients.
Write to Aaliyah Rogan at Mining.com.au
Images: Anglo American
