Anglo shares rise amid renewed takeover speculation
BHP is now free to relaunch a bid to acquire Anglo, as the six-month standstill mandated by London’s takeover rules has expired.
Anglo American is still exploring a sale of its thermal coal assets in South Africa as an alternative to spinning off and listing the business, three sources familiar with the matter told Reuters.
Mining companies are under pressure to stop mining coal, the most polluting fossil fuel, from investors and governments keen to switch to cleaner fuels.
London-listed Anglo said earlier this month that it would spin off its last remaining coal assets in South Africa and list them in Johannesburg.
Sources say an outright sale of Anglo American’s coal mines was still on the cards.
When asked for comment, Anglo referred Reuters to a response to shareholders in May saying the company would continue to consider other exit options.
Launching a sale process is designed to help Anglo generate some positive tension over the pricing of listing
Chief Executive Mark Cutifani told Reuters in February that the company had already received interest from potential buyers both inside and outside of South Africa.
“Launching a sale process is designed to help Anglo generate some positive tension over the pricing of listing,” one of the sources said.
“They will do it as a dual track process, knowing that only a domestic or emerging market buyer would come forward,” the source added.
Despite a global shift against the use of polluting fossil fuels, coal is still widely used in emerging markets including China, India, Indonesia and Vietnam among others.
A second source said the sales process is expected to attract local bidders but that Exxaro Resources, already a partner on one of the mines, would be the only one with enough firepower to purchase the assets without a partner.
Anglo’s assets would be also marketed to companies including state-backed Coal India, Russia’s Suek and China Coal , a third source said.
The remaining portfolio includes a handful of mines, including a joint venture with Exxaro, which churned out around 18 million tonnes of thermal coal last year, mostly for export.
A source familiar with the matter said Anglo was handling the coal spin-off internally for now.
(By Clara Denina, Zandi Shabalala and Tanisha Heiberg; Editing by Susan Fenton)
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