Anglo American global mining company has agreed to sell the entirety of its steelmaking coal business, to generate up to $4.9bn in aggregate gross cash proceeds, including the already announced sale of Anglo American’s interest in Jellinbah for around $1.1bn.
The company has agreed to sell its portfolio of steelmaking coal mines that it operates in Australia to Peabody Energy for a cash consideration of up to $3.775bn.
Anglo said that the Peabody’s agreed cash consideration of up to $3.775bn comprises an upfront cash consideration of $2.05bn at completion, deferred cash consideration of $725m, the potential for up to $550m in a price-linked earnout, and contingent cash consideration of $450m linked to the reopening of the Grosvenor mine.
Duncan Wanblad, chief executive of Anglo American, commented “The sale of our steelmaking coal business is another important step towards delivering the strategy that we set out in May to create a world class copper, premium iron ore and crop nutrients business.
“In steelmaking coal, through a combination of today’s announced Transaction and our previously announced agreement to sell our interest in Jellinbah, we stand to unlock up to US$4.9 billion of value, reflecting the high quality of the assets and adding to our balance sheet resilience.”
Jim Grech, president and chief executive officer of Peabody, noted: “We’re 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.”
Peabody has agreed to pay a $75m deposit on signing which Anglo American is entitled to retain if the sale is terminated in certain limited circumstances, according to Anglo American.
The transaction is subject to a number of conditions, including customary competition and regulatory clearances, and pre-emption arrangements.
