Anglo American (OTC:AAUKF) has agreed to sell its Australian steelmaking coal portfolio to Peabody Energy (NYSE:BTU) for up to $3.8 billion. The sale marks another step toward future-facing commodities, following the $1.1 billion sale of its stake in the Jellinbah Group earlier this month.
“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,” said Peabody CEO Jim Grech. “We look forward to integrating these assets, teaming up with their highly skilled workforce, and aligning with our new mine joint venture partners to create long-term value.”
This coal portfolio includes an 88% stake in the Moranbah North JV, a 70% interest in the Capcoal JV, and several other major interests, such as the Dawson and Roper Creek JVs. These assets are critical producers of metallurgical coal, essential for steelmaking, and should be meaningful contributors to Peabody’s operations.
Per the deal's terms, Anglo American will receive an upfront cash payment of $2.05 billion, deferred cash payments totaling $725 million, a price-linked earnout of up to $550 million, and $450 million contingent on the reopening of the Grosvenor mine. The deal will close by Q3 2025, pending regulatory approvals.
“The sale of our steelmaking coal business is another important step toward delivering the strategy we set out in May to create a world-class copper, premium iron ore, and crop nutrients business. We're focused on streamlining costs, simplifying our portfolio, and unlocking market value,” said Anglo American CEO Duncan Wanblad.
The company has set a target of $1 billion in cost savings by 2025 and expects an additional $800 million in recurring pre-tax benefits. The broader restructuring plan includes divesting from coal, platinum, nickel, and diamonds. The demerger of Anglo American Platinum (Amplats) is expected by mid-2025, and the nickel business sale is progressing with strong interest.
The crown jewel of Anglo American’s portfolio, De Beers, remains on books. Weaker Chinese diamond demand and an influx of synthetics have created persisting weakness, making asset sales unattractive.
Earlier this year, Anglo American embarked on a major restructuring to fend off a takeover bid from BHP. To position itself for long-term growth, the company is focusing on high-margin, future-facing minerals like copper, quality iron ore, and crop nutrients.
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