Anglo American (OTCQX:AAUKF) has unveiled a major shakeup of the company on Tuesday, which includes selling its steelmaking coal, platinum, nickel and diamond mining businesses, as the British miner aims to stave off BHP’s (NYSE:BHP) takeover bid.
Anglo American (OTCQX:AAUKF) said it will divest its steelmaking coal business, and is currently responding to strong buyer interest. It is also exploring options for care and maintenance and divestment of its nickel business.
Anglo American Platinum (OTCPK:ANGPY) will also be demerged in a way that optimizes value for its shareholders as well as those of Anglo (OTCQX:AAUKF). Anglo American’s (OTCQX:AAUKF) De Beers unit will be divested or demerged “to improve strategic flexibility,” the company said in a statement.
The company’s overhaul is aimed at sharpening Anglo American’s (OTCQX:AAUKF) focus on copper and premium iron ore, while retaining crop nutrients optionality at Woodsmith.
“We expect that a radically simpler business will deliver sustainable incremental value creation through a step change in operational performance and cost reduction,” said Anglo American (OTCQX:AAUKF) CEO Duncan Wanblad. “These actions represent the most radical changes to Anglo American in decades.”
The plan was unveiled just a day after Anglo (OTCQX:AAUKF) rejected BHP’s (BHP) new £34B proposal, as the offer continued to “significantly undervalue” the company.
Anglo American (OTCQX:AAUKF) said it is on track to achieve its targeted run rate of $1B annual savings in operating expenditure in 2024. “Additionally, a further $0.8B of cost out from the end of 2025 is targeted.”