Mining giant Anglo American will spin off its booming business as it tries to fend off a takeover

LONDON — Mining giant Anglo American PLC plans to spin off its expanding global business — including spinning off its DeBeers diamond operation — as it seeks to avoid a takeover and focus on minerals expected to grow amid the global shift to energy green.

London-based Anglo American said on Tuesday it would spin off its platinum business, sell a unit that produces coal used in steel production and “explore all options” to separate DeBeers from its parent company.

The measures will allow Anglo American to focus on copper and iron ore production, which together accounted for more than two-thirds of its profit last year. The company will also maintain its agricultural nutrients business.

The announcement came a day after Anglo American rejected a sweetened takeover offer from rival BHP Group, which valued the company at 34 billion pounds ($42.6 billion). This was around 9% higher than BHP’s previous offer.

“We are taking clear and decisive action to add value – safely, responsibly and reliably – in the long-term interests of our shareholders and other stakeholders, and to deliver the products that are so critical to enabling the energy transition and supporting a better overall life. standards and food safety,” Anglo chief executive Duncan Wangled said in a statement.

Anglo American shares fell 2.8% to 2,632 pence in mid-afternoon trading in London on Tuesday. Shares have risen as much as 33% in the previous three weeks on speculation about a takeover.

The company seeks to simplify its operations and increase returns for shareholders by focusing on a smaller range of products that could benefit from the effort to reduce the use of fossil fuels and reduce carbon emissions associated with global warming.

Demand for copper, a key component of electrical wiring, solar panels, wind turbines and electric vehicles, is expected to double by 2035, according to an analysis by S&P Global Market Intelligence.

Anglo American also claims that high-quality iron ore from its mines can help steel producers reduce carbon emissions, while the natural fertilizer the company produces can help increase crop yields and reduce steel emissions. agriculture.

Anglo American was the eighth largest mining company in the world last year, when it reported revenues of US$30.7 billion. This value was eclipsed by the US$217.8 billion generated by Glencore, the largest mining company in the world.

Anglo American was founded more than 100 years ago to mine gold in South Africa and quickly expanded into diamonds, platinum and copper.

At the end of last year, the company had around 60,000 employees in 13 countries, from Australia to Peru.

The company owns 85% of De Beers, which produces about a third of the world’s rough diamonds and sells diamond jewelry. The remainder is owned by the Botswana government.

South Africa remains at the heart of Anglo American’s business, with the company employing more than 36,000 people in the country at the end of last year.

Anglo American acknowledged the impact the reorganization plan could have on workers, promising to engage with “relevant stakeholders” and comply with all consultation requirements and local laws.