Key Points
- Anglo American sells Australian coal mines to Peabody for $3.8 billion.
- The company pivots toward sustainable commodities like copper and iron ore.
- Cost-saving efforts aim to deliver $1 billion by 2025.
Anglo American, the multinational mining giant, announced on Monday the sale of its remaining Australian steelmaking coal mines to U.S.-based coal producer Peabody for $3.8 billion. This move is part of the company’s ongoing strategy to reshape its portfolio and focus on commodities critical to future global growth.
A major step in portfolio reshaping
The sale follows Anglo American’s recent divestment of its 33.3% stake in the Jellinbah and Lake Vermont coal mines joint venture for $1.1 billion. Together, these transactions amount to $4.9 billion, signaling the company’s decisive exit from coal mining in Australia.
CEO Duncan Wanblad, who outlined the company’s transformation strategy earlier this year, emphasized Anglo American’s shift toward copper, premium iron ore, and crop nutrients—commodities poised to play significant roles in a sustainable future. The company is concurrently phasing out assets in coal, platinum, nickel, and diamonds as part of this restructuring.
Details of the sale and future plans
The $3.8 billion deal with Peabody includes a mix of upfront payments, deferred cash, and contingent payments linked to production milestones. The steelmaking coal portfolio comprises interests in several joint ventures, including Moranbah North, Capcoal, Roper Creek, Dawson, and Theodore South.
In commenting on the sale, Wanblad expressed confidence in Peabody’s ability to steward these assets effectively. “Peabody is a long-established and respected operator,” he said, adding that the transaction aligns with Anglo American’s strategic vision.
Meanwhile, Peabody CEO Jim Grech noted the acquisition would add value to their portfolio and highlighted shared values around safety, sustainability, and responsible operations.
Broader transformation goals
According to a report by Mining Weekly, Anglo American’s restructuring plan goes beyond coal divestments. The company is advancing the demerger of Anglo American Platinum, expected by mid-2025, and exploring the sale of its nickel business. Additionally, preparations are underway for the separation of De Beers, with the aim of positioning the diamond business for long-term success.
Cost efficiency is another critical pillar of Anglo American’s transformation. Wanblad noted the company is on track to deliver $1 billion in cost savings, with plans to achieve $800 million in recurring pre-tax benefits by the end of 2025.
Although Anglo American is winding down its active mining operations in Australia, it will continue exploration activities in the region, maintaining a footprint in one of the world’s key mining markets.
This latest sale underscores the company’s commitment to repositioning itself for a future centered on sustainable and growth-focused commodities. As Wanblad stated earlier this year, the transformation aims to align Anglo American’s operations with evolving global demands while creating long-term value for stakeholders.
