War Chest, page-4

Anglo American is planning to sell its five Queensland coal mines as a single unit rather than individually, but plans to keep some technical and exploration teams in Australia after it completes a “radical” break-up. Duncan Wanblad, chief executive of the London-listed diversified miner, announced a sale of the coal division as part of a strategy to sell or shut everything but Anglo’s copper, iron ore and crop nutrient assets. The strategy, he said, had been accelerated by a $64.4 billion takeover offer for the company, which Anglo has rejected.

Anglo American CEO Duncan Wanblad outlined his company’s new strategy on Tuesday 14^th May 2024. Anglo’s Queensland coking coal mines delivered $999 million of net profit last year and more than $2.83 billion the previous year, according to documents filed with the Australian Securities and Investments Commission. CreditSights, a division of ratings agency Fitch, estimates Anglo could fetch $US4.6 billion ($6.9 billion) for the coal assets, and if the hotly contested process BHP ran for the nearby Daunia and Blackwater mines last year is any guide, Anglo will have no shortage of suitors for the assets. Mr Wanblad pointedly said on Tuesday that offers had already been received, and the coal assets could be sold “rapidly”. The sale process comes eight years after Anglo considered selling Grosvenor and Moranbah North to repay debts; that sale process was abandoned when commodity prices rallied and Anglo subsequently sought to assure its Australian workforce that it was here to stay.

In summary, Anglo American intend to sell their suite of 5 QLD coal mines as a 'single unit' not 'individually'. The estimated asking price to be between A$6b - A$7b, depending on bidder interest, aligned with the pricing for WHC's recent BMA acquisition.

If YAL could mastermind a deal similar to the WHC ~ BMA acquisition comprised of a smaller upfront payment funded by cash with some debt (likely required), plus an additional 3 years of deferred and contingent payments (non-interest bearing) paid from operating cash flows of the newly acquired assets, this would be highly accretive for shareholders in my opinion. We may even see two companies work together in a joint venture to secure the AA assets, as some have already suggested. Whoever chooses to participate in the bidding process will be up against some big names with BHP likely top of the list, see more in article below.

https://www.australianmining.com.au/who-will-buy-anglos-aussie-coal/