08 Apr Anglo American to exit coal via South African assets spin out
Anglo American has announced it will separate its South African coal assets into a new business later this year, amid growing calls to ditch the polluting commodity from its ESG-focused investor base.
The demerged company, named Thungela Resources, will list on the Johannesburg and London stock exchanges, with Anglo’s investors receiving one Thungela share for every 10 Anglo shares.
The soon-to-be standalone miner produced 16.5 million tonnes of coal last year in South Africa and has assets worth US$1.3 billion in the country. Anglo executive July Ndlovu has been appointed Thungela’s first CEO.
“As the world transitions towards a low-carbon economy, we must continue to act responsibly,” chief executive Mark Cutifani said in a statement. “Our proposed demerger of what are precious natural resources for South Africa allows us to do exactly that.”
Anglo’s exit from the coal industry mirrors similar moves made by the world’s two largest mining companies. Last August, BHP announced plans to exit thermal coal as part of its commitment to reduce emissions, while Rio Tinto sold its last coal mine in 2018.
However, metallurgical or coking coal still appears to be one of Anglo’s key commodities moving forward. The LSE-listed firm recently increased its medium-term guidance for the steelmaking ingredient to an estimated 26-28 million tonnes by 2022.