Anglo American (LON: AAL) shares fell 2.6% on Monday morning after the mining giant agreed to sell its Australian steelmaking coal portfolio to Dhilmar Limited for up to $3.875 billion in cash, marking a major step in its ongoing portfolio overhaul ahead of its planned merger with Teck.
Under the terms of the deal, Dhilmar will pay US$2.3 billion upfront upon completion, with a further price-linked earnout of up to US$1.575 billion payable over five years, contingent on coal prices exceeding agreed benchmark levels. Anglo American said the proceeds will be used to reduce net debt.
The steelmaking coal portfolio includes majority stakes in several Australian joint ventures, among them the Moranbah North, Grosvenor, Capcoal, Roper Creek, and Dawson operations. Completion is anticipated by the first quarter of 2027, subject to regulatory and competition clearances.
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Chief Executive Duncan Wanblad described the transaction as “another major step in the simplification of our portfolio,” adding that it would complete Anglo American’s full exit from steelmaking coal. When combined with the approximately US$1 billion received from the earlier sale of its stake in the Jellinbah mine, total aggregate proceeds from the coal exit reach up to US$4.9 billion.
The deal comes after a failed prior agreement with Peabody in November 2024, which Anglo American says was wrongfully terminated. The company confirmed it is continuing arbitration proceedings against Peabody, expressing confidence that the disputed incident at Moranbah North did not constitute a Material Adverse Change.
Dhilmar has experience operating major mining assets across Southeast Asia and Canada.
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