https://newsletter.mw.creamermedia.com
Business|Coal|Copper|Diamonds|Fire|Hatch|Iron Ore|Mining|Platinum|PROJECT
Business|Coal|Copper|Diamonds|Fire|Hatch|Iron Ore|Mining|Platinum|PROJECT
business|coal|copper|diamonds|fire|hatch|iron-ore|mining|platinum|project

Anglo to face investors with wary eye on BHP's potential return

Anglo CEO Duncan Wanblad

Anglo CEO Duncan Wanblad

24th July 2024

By: Reuters

  

Font size: - +

Anglo American investors will keenly scrutinize CEO Duncan Wanblad on Thursday as he gives an update on the London-based miner's strategy, just months after fighting off a $49-billion takeover bid from bigger rival BHP Group.

Delivering first-half earnings results for the first time after rebuffing the world's No. 1 miner, Wanblad and his team need to convince investors that the strategy to refocus on copper, iron ore and a fertilizer project is on track.

While Wanblad pinned his approach on getting an early start with selling Anglo's coking coal assets in Australia, which the company said has drawn huge interest, an unexpected and unwieldy fire at its Grosvenor mine at one of the mines could torpedo the well-laid plans, setting the timing back with a possible hit to the deal's valuation.

"Clearly, any updates on the simplification strategy will be closely watched," said Richard Hatch, analyst at Berenberg.

"Our key questions centre around the challenges of selling the coal business ... and whether Anglo would accept payments in contingent form due to operational issues," Hatch added.

Anglo has already cut its output forecast for steelmaking coal, because of the June 29 fire at its Grovesnor mine that has rendered the affected sections inaccessible. Damage assessment and re-opening is going to take several months, Anglo said.

Investors also expect Anglo to write off the value of its Woodsmith fertiliser project in northern England, having earlier said it would slow down development but still invest $800-million this year. Anglo already wrote down $1.7-billion on the project a year ago.

The restructuring plan, which also includes the demerger of its South African platinum unit, closure or sale of its nickel mines and the divestment of diamonds business De Beers, could be completed by 2025.

Unless, BHP resumes its pursuit or other suitors, join the hunt.

"BHP could come back after six months or could wait for the Amplats unbundling to be complete," said Ian Woodley, portfolio manager at Old Mutual.

"If I were them, I would wait at least until the unbundling has moved along a bit further," he added.

The main prize in Anglo's portfolio are its world class and long-life copper assets in Latin America.

Copper is seen as a drawcard to deals in the mining sector, with investors expected to demand that even the most profitable companies show plans on how to grow the metal's portfolio.

"Having an exposure to the copper sector, to the copper price, is attractive for investors," said Erik Belz, president and chief operating officer at hedge fund Engine No. 1.

"Consolidation can get our (investors) costs down. If we get our costs down, we can expand our margin. And if the price goes up on top of that, then that's sort of two ways to win," Belz added.

Edited by Reuters

Comments

Showroom

Rentech
Rentech

Rentech provides renewable energy products and services to the local and selected African markets. Supplying inverters, lithium and lead-acid...

VISIT SHOWROOM 
WearCheck
WearCheck

Leading condition monitoring specialists, WearCheck, help boost machinery lifespan and reduce catastrophic component failure through the scientific...

VISIT SHOWROOM 

Latest Multimedia

sponsored by

Photo of Martin Creamer
On-The-Air (04/10/2024)
4th October 2024 By: Martin Creamer
MMC, Pan African, Vanadium Resources make headlines
MMC, Pan African, Vanadium Resources make headlines
4th October 2024
Magazine round up | 04 October 2024
Magazine round up | 04 October 2024
4th October 2024

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION







sq:0.115 0.192s - 142pq - 2rq
Subscribe Now