Anglo wants to unbundle

Henry

In an attempt to fend off a significant acquisition offer from Australian rival BHP, Anglo American announced on Tuesday that it will sell its coal, diamond and platinum steel manufacturing operations and focus on key minerals.

Anglo has announced that it is speeding up measures to streamline the company and thus reward shareholders, in what it describes as a “radical overhaul”. It comes after his rejection of BHP’s improved takeover offer. The offer was valued at £34 billion (R676 billion). “Following an asset survey that began during 2023, Anglo American plans to implement a number of major structural changes in order to accelerate delivery, while still meeting its strategic priorities of operational excellence. The company also wants to simplify and grow its portfolio through this, says a statement, a day after news about the rejection of the takeover offer came to light. Duncan Wanblad, CEO of Anglo, says a simpler business will create more value, especially if the operating performances change and costs are cut.

“The value of our copper and iron ore assets will be prioritized, and Anglo American’s shareholders will fully benefit from these significant improvements,” says Wanblad.

Copper is essential for the world’s transition to renewable energy, as it is an essential component for greener technology such as energy storage, electric vehicles, solar panels and wind turbines.

As a result, the copper price has skyrocketed in the past year and Anglo American expects the trend to continue.

Copper passed $10,000 a tonne for the first time in two years last month, with analysts attributing this to strong demand and tight supplies. The price may also rise further due to BHP’s bid proposal.

Anglo said on Tuesday it plans to close its steelmaking operations and is considering selling the nickel operations.

“These actions represent the most radical changes to Anglo American in decades. We are taking clear and concrete steps to add value for the long-term interests of our shareholders and other stakeholders,” says Wanblad.

Anglo American was founded in South Africa in 1917 by Ernst Oppenheimer and is today one of the largest mining companies in the world.