Anglo American’s Barro Alto nickel mine in Brazil.
Anglo American (LSE: AAL) has set a June deadline to demerge its platinum business and has agreed to sell its nickel unit for $500 million as the company’s effort to focus on its copper assets gathers pace.
Anglo plans to sell its Brazil-based nickel business to China-backed MMG Limited subsidiary MMG Singapore Resources, the company reported Tuesday.
The payment is to comprise $350 million upfront at the deal’s close, up to $100 million in price-linked earnout and a conditional $50 million tied to the final investment decision for development projects.
“The sale of our nickel business after a highly competitive process marks a further important milestone towards simplifying our portfolio to create a more highly valued copper, premium iron ore, and crop nutrients business,” Anglo CEO Duncan Wanblad said in a release.
“MMG is well-respected as a safe and responsible operator and we believe our agreement represents a strong outcome not only for our shareholders, but also for our employees and Brazilian stakeholders.”
Shares in Anglo American fell 1% on Tuesday in London to £24.47 ($30.87) apiece, valuing the company at £33 billion. They’ve traded in a 52-week range of £16.57 to £28.13.
$5.3B in total cash
The nickel business sale, along with the sale of Anglo’s steelmaking coal operations in Australia in November 2024, is anticipated to produce up to $5.3 billion in total cash proceeds, Wanblad added.
The Brazilian nickel assets include the Barro Alto mine, Niquelândia mine and the Barro Alto and Codemin ferronickel processing plants, which produced 39,400 tonnes of nickel in 2024. There are also the greenfield projects Jacaré, that hosts a 300-million-tonne resource, and Morro Sem Boné with total potential mineralization of 65 million tonnes.
Amplats demerger
Anglo meanwhile has set a timeline of three months or so to demerge Anglo American Platinum (JSE: AMS), after it first announced a plan to break up its businesses last May. Its diamond business De Beers is also part of the demerger, amid BHP’s failed bid to acquire Anglo for $49.2 billion last year. Anglo said earlier this month it was nearing a decision on when the De Beers spinoff would happen, without specifying a date.
Anglo’s final dividend for 2024, as well as an additional cash dividend for a total of R16.5 billion ($895 million), is to be paid to all Amplats shareholders before the demerger. As a 67% shareholder in Amplats, Anglo expects to receive about $600 million from the dividends.
Anglo plans to keep a 19.9% shareholding in Amplats to help manage flowback – when new shareholders after a move like demerging sell their stock – by reducing the size of the shareholding to be demerged, Wanblad said. The company intends to eventually leave its Amplats holding, he added. Anglo is to seek shareholder approval for the Amplats demerger at its next annual general meeting on April 30.
