Anglo American Plans De Beers Sale in Strategic Overhaul
Anglo American PLC has announced a major restructuring initiative that involves divesting from its De Beers diamond business, its platinum operations, and its coal units. This strategic overhaul is intended to focus the company on copper and other commodities, particularly those with applications in electric vehicles and steel production. Anglo American aims to improve its operational performance and reduce costs, projecting an increase in EBITDA margin from 31% to 46%, while maintaining a 40% dividend payout ratio.
The restructuring includes the demerger of its 79% stake in Anglo American Platinum and the potential sale of its steelmaking coal assets and nickel operations. The company has also decided to slow down investment in the Woodsmith fertiliser mine in North Yorkshire. These moves are seen as a response to BHP's repeated takeover bids, with the latest being a £34 billion offer that Anglo American rejected, considering it undervalued the company.
De Beers Group, affected by the planned demerger, has expressed its commitment to its strategy and to creating value for its stakeholders, highlighting the 'Building Forever' sustainability goals. The company's CEO Steve Whitaker remains confident in De Beers' position as a leader in the diamond industry.
The decision by Anglo American to sell off these parts of its business has been met with political concern in South Africa due to the potential impact on jobs. The restructuring represents significant changes for Anglo American, aiming to simplify its portfolio and provide greater shareholder value.
