Anglo American announces major structural changes

The announcement comes after its rejection of BHP's proposal to take over the company.

Anglo American says BHP's latest proposal 'continues to significantly undervalue Anglo American and its future prospects'.

The firm says it is confident in Anglo American’s standalone future prospects, and has accelerated plans for delivery of its strategy 

It unveils a simpler portfolio of assets following a review that started last year, with a '100% future-enabling portfolio, including 54% copper production, in products that support the energy transition, improving global living standards and food security'.

The new portfolio configuration is said to be of US$1.7bln lower cost.

The measures and assets include:

• A defined pathway to >1Mt per annum of copper production at three of the top 10 producing copper mines in South America
• Focused producer of 100% premium iron ore, suited to support steel decarbonisation.
• Slowing down development of crop nutrients, while critical technical studies are completed in 2025.
• Steelmaking coal to be divested and currently responding to strong buyer interest.
• Exploring options for care and maintenance of nickel assets and divestment.
• Anglo American Platinum to be demerged to optimise value for both Anglo American’s and Anglo American Platinum’s shareholders.
• De Beers to be divested or demerged, to improve strategic flexibility for both De Beers and Anglo American.

Duncan Wanblad, Chief Executive of Anglo American, says, 'We set out our clear strategic priorities earlier this year – operational excellence, portfolio simplification and growth. Our decision to focus Anglo American’s portfolio in our world-class resource asset base in copper and premium iron ore – while retaining our crop nutrients optionality at Woodsmith – marks a major new phase in executing our strategy...These actions represent the most radical changes to Anglo American in decades.

“Of course, we are conscious of the impacts of making such far-reaching changes, particularly on our employees. We see considerable opportunities for our employees, both in delivering the full potential of Anglo American and in the businesses that we will be divesting or demerging, all of which are high-quality businesses in their own right.

'By implementing these portfolio changes ourselves, we will be able to do so in a manner that is respectful of our employees, host communities and countries, including ensuring that in South Africa, in particular, Anglo American continues to play its role as a responsible business leader to support the country’s national priorities.'