Anglo – repositioning its portfolio

Anglo American Platinum has made significant progress on the repositioning of its portfolio, continuing to move its production down the cost curve and creating a more value enhancing portfolio.

mogalakwena-mine
Image credit: Anglo American Platinum

Anglo made it known that it had intentions to divest assets which did not fit its long-term strategy. The assets included Rustenburg, Bokoni (placed on care and maintenance on 30 October 2017), Union and the Pandora joint venture. In addition, Anglo plans on selling long-dated resources at Amandelbult.

COMPLETION OF DISPOSAL OF LONG-DATED AMANDELBULT RESOURCES

Anglo announced the completion of the disposal of mineral resources within the Amandelbult mining right to Northam Platinum on 6 December 2017. Anglo received cash amounting to R1-billion, which was used to reduce debt.

COMPLETION OF PANDORA JV

Anglo announced the completion of the disposal of its loss-making 42.5% interest in Pandora to Lonmin for a deferred cash payment of a minimum of R400-million and a maximum of R1-billion (both in nominal terms), based on 20% of free cash flow over six years; and the use of and full operational control of Lonmin’s Baobab concentrator for a three-year period commencing 1 December 2017.

Taking over operational control of Baobab concentrator will allow the Anglo to continue processing excess ore from Mogalakwena mine and pursue optimisation initiatives at the Baobab concentrator. 

DISPOSAL OF UNION MINE

As announced on 15 February 2017, the sale and purchase agreement to dispose of Anglo American Platinum’s 85% interest in Union Mine and its 50.1% interest in MASA Chrome Company to a subsidiary of Siyanda Resources, was signed on 14 February 2017.

Progress has been made on completing the conditions precedent, including approval from the South African competition authorities in accordance with the Competition Act on 13 September 2017 and consent in terms of section 11 of the Mineral and Petroleum Resources Development Act on 7 November 2017. Anglo and Siyanda are working to ensure a smooth transition of Union and MASA to Siyanda.

Commenting on the progress of the repositioning Chris Griffith, Anglo American Platinum CEO, says, “We have made significant progress in the repositioning of our portfolio with the disposal of our 42.5% interest in Pandora to our joint venture partner Lonmin, completing the disposal of long-dated resources at Amandelbult to Northam and progressing the disposal of Union and MASA to Siyanda.” Griffith adds that he believes the transactions are beneficial for all parties involved, enabling a sustainable future for Pandora and Union mines.

“The benefits of operational control over the Baobab concentrator will enable us to continue to unlock value at Mogalakwena mine, and the cash proceeds received from Northam will allow us to further reduce our net debt position. We will continue to focus on completing the disposal of Union and MASA, which is expected to occur in early 2018,” he concludes.


 

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