Glencore consolidates global coal portfolio in Australian entity
Mining and trading house Glencore consolidated its global portfolio of coal and ferroalloy assets under one company registered in Australia, according to its annual report lodged with the country’s regulator.
Last December, Glencore moved the projects held by a subsidiary, Glencore SA Holdings, to its Australian entity, “effectively consolidating its global portfolio of operational coal assets” it said in the report, which was lodged with the Australian Securities and Investment Commission last month.
“As part of the transaction, the group also acquired ferroalloy assets in South Africa and an equity interest in the Mara copper and gold project in Argentina,” it said.
The move followed discussions between Glencore and mining rival Rio Tinto Group over a potential combination of their businesses, a deal that ultimately was not pursued. Bloomberg first reported on the discussions, which would have required Glencore to spin off its coal assets, in January.
“As part of the planning for the previously considered coal spin off, combined with the acquisition of EVR, we commenced a process to restructure the coal business and align it with the management structure given the coal industrial assets are managed out of Australia,” spokesman Francis De Rosa said. EVR refers to Elk Valley Resources, a metallurgical coal business acquired from Teck Resources.
“We chose to complete the restructure despite the shareholder engagement resulting in a decision not to proceed with the spin off,” De Rosa said.
Glencore previously proposed a merger with Rio in 2014. However, in the decade since then, Rio has pivoted away from coal and fossil fuels to focus on growing its copper exposure and developing a low-cost lithium business.
The consolidation was first reported by the Australian Financial Review.
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