UK-based mining company Anglo American has taken another major step toward reshaping its portfolio ahead of its planned merger with Teck Resources, announcing an agreement to sell its Australian steelmaking coal business to privately held mining group Dhilmar Limited for total cash proceeds of up to $3.875 billion.
According to the company, the transaction, which would mark Anglo American’s full exit from steelmaking coal, includes an upfront payment of $2.3 billion at completion and a price-linked earnout of as much as $1.575 billion, with the company stating that the proceeds will be used to reduce net debt. Together with the previously completed sale of its interest in the Jellinbah mine for around $1 billion, the latest agreement would bring Anglo American’s total cash proceeds from its withdrawal from the steelmaking coal segment to up to $4.9 billion.
Completion of the deal, which remains subject to customary competition and regulatory clearances as well as pre-emption arrangements, is expected by the first quarter of 2027, while the upfront consideration will be adjusted in line with normal completion mechanisms.
Anglo American CEO Duncan Wanblad said the agreement underlines both the quality of the Australian assets and the strength of the workforce operating them, while also noting that Dhilmar’s management has considerable experience in major mining operations, including steelmaking coal assets in Southeast Asia and Canada. He added that the two companies will work closely with employees, local communities, government authorities, customers and other partners to support a smooth transition.
The Australian portfolio covered by the sale includes Anglo American’s interests in a number of Queensland coal joint ventures, led by its stakes in Moranbah North and Grosvenor, as well as Capcoal, Roper Creek, Dawson, Dawson South, Dawson South Exploration, Theodore South and Moranbah South.
Separately, Anglo American said it will continue arbitration proceedings with Peabody over the November 2024 agreement under which Peabody had agreed to acquire the same steelmaking coal portfolio, maintaining its position that the Moranbah North incident cited by Peabody as grounds for terminating that agreement did not constitute a material adverse change, as previously reported by SteelOrbis.
