Anglo American plc earlier today announced it has reached an agreement with China Molybdenum Co. Ltd. (CMOC) to sell its niobium and phosphates businesses in Brazil for $1.5 billion in cash. Analysts said the sale was at around $500 million above expectations. Other companies that were interested in the Anglo assets are reported to have included The Mosaic Co., Vale SA in partnership with U.S private equity firm Apollo Global Management (GM April 15, p.14) as well as EuroChem Group AG.
“The proceeds from this transaction … will enable us to continue to reduce our net debt towards our targeted level of less than $10 billion at the end of 2016,” said Anglo’s CEO, Mark Cutifani. Anglo put up the niobium and phosphates businesses for sale in December as part of an accelerated and more radical restructuring to redefine the focus of the group’s asset portfolio and cut debt (GM Dec. 14, 2015). Anglo said in mid-February it already had received expressions of interest from 16 bidders for the businesses and CEO Mark Cutifani had said a sale could happen “within two-to-three months.”
Anglo’s phosphates business includes the Chapadao phosphate mine and a beneficiation plant at Ouvidor in Goiás state and two downstream phosphates complexes located at Catalão, also in Goiás state, and at Cubatão in São Paulo state (GM Oct. 26, p. 14). The business also includes the Coqueiros and Morro Preto phosphate deposits. The niobium and phosphates businesses in 2015 reported a combined EBIT of $119 million on revenues of $544 million ($433 million from phosphates and $111 million from niobium) and posted a pre-tax profit of $69 million. The business contributed 5 percent of Anglo’s total EBIT of $2.22 billion last year.