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Anglo American has launched the first stage in its platinum divestment, preparing to sell 5 per cent of its controlling stake in Anglo American Platinum, ahead of a full demerger of the unit.
The London-listed mining group is undergoing a radical restructuring after defending itself from BHP’s £39bn takeover attempt earlier this year, and will sell or spin out its coal business, diamond mines, nickel assets and platinum as part of that plan.
Anglo is under pressure to prove its strategy can deliver value for shareholders, after it rejected BHP’s all-share offer in May.
The sale, which could raise about $400mn based on the current share price of the platinum business, known as Amplats, will reduce Anglo’s holding in the unit from 78.6 per cent to 73.7 per cent, and increase the free float of the Johannesburg-listed platinum unit.
After the share sale, Anglo will fully demerge the business by distributing its remaining Amplats shares to its own shareholders, a process that will be completed by the end of next year.
Anglo said: “The placing is intended to broaden the free float of Anglo American Platinum, reduce the number of shares distributed to Anglo American shareholders upon demerger and thereby reduce flowback following the demerger. The placing will also raise proceeds for Anglo American.”
Amplats has been plagued by weak platinum prices, which have dropped by a quarter since their peak in 2021. Last year its earnings dropped 71 per cent, forcing the company to announce 3,700 job cuts in February, almost a fifth of the workforce.
Anglo said it was still considering the possibility of a secondary listing for Amplats in London, while keeping its primary listing in Johannesburg.
Amplats’ share price has dropped 40 per cent since the beginning of this year.
As well as platinum, the company also mines the other five so-called platinum group metals — palladium, ruthenium, rhodium, osmium and iridium.
The sale of Anglo’s coal unit, which includes five mines in Queensland, Australia, is already under way and analysts expect it could fetch roughly $4bn. First-round bids have been received for the coal mines, and the company hopes to have the coal sale wrapped up by January.
