Peabody Energy To Acquire Anglo American's Australian Coal Mines In $3.78 Billion Deal

Anglo American has decided to sell its last existing steelmaking coal mines in Australia to Peabody Energy for up to $3.78 billion.

This deal marks the first major disposal in Anglo American's wider restructuring plan, which saw the London-listed miner divesting or closing its multiple steelmaking assets.

The company pivoted to restructuring, primarily to refocus on copper -- an essential resource amid rising global demand for sustainable energy solutions -- after fending off a BHP takeover offer worth $49 billion, Reuters reported.

The mass liquidation of its assets and increasing company value were part of a bigger scheme to protect itself from unwanted takeover attempts.

Anglo American and Peabody reached an agreement that called for an upfront payment of $2.05 billion upon completion. Peabody will also provide $725 million in deferred cash, with an additional $550 million possible. A $450 million contingent payment was included, based on the Grosvenor mine's reopening after a fire shut it down in June, Anglo American said in a statement.

Following the announcement, Anglo American's stock price increased 2.4% on Tuesday.

Anglo American got a "good price" for the transaction, according to Ben Cleary, portfolio manager at Tribeca Investment Partners, which owned a sizeable portion of the company.

"A decent amount of cash and the deferred element seems sensible," he added.

Reacting to the deal, Peabody CEO Jim Grech said, "These assets align with our values of safety, sustainability, and social responsibility. We look forward to collaborating with Anglo American and leveraging these world-class resources to create long-term value."

Moranbah North, Grosvenor, Aquila, and Capcoal located in Australia's Bowen Basin were companies that also feature in Peabody's acquisition wishlist.

Meanwhile, in a back-to-back deal, Anglo's Dawson mine will be sold for $455 million to a division of Indonesia's Delta Dunia Group, which operates the BUMA coal mining services company.

"We see potential for a material re-rating in the medium-term as Anglo delivers on its restructuring plan, leaving a simplified portfolio with a 60% exposure to copper," said Marina Calero, an analyst at RBC Capital Markets. "A renewed approach from BHP cannot be ruled out, with the end November deadline soon approaching."