Anglo American’s Los Bronces Integrated project in Chile involves replacing part of the currently mined ore with another with a higher copper content, in order to maintain production-levels over time and maintain the useful life of the mine until 2036. Photo: SUPPLIED
Anglo American is disposing of two mining royalties in Chile and Australia for $195 million (R3.56 billion).
The London and Johannesburg-listed resource firm today announced that it had entered into agreements for the disposal of iron ore royalties in Australia and gold as well as copper ones in Chile.
The gold, copper and gold royalties are being disposed to Taurus Funds Management, an Australian commodities specialist that invests in private and public resource companies across the world.
“Anglo American has entered into definitive agreements to sell two royalties to Taurus Funds Management for a total of up to $195m cash: comprising an upfront cash payment of $150m and up to $45m of deferred cash consideration,” it said.
The $45m deferred cash payment is however “subject to certain conditions” that have to be fulfilled. Anglo American expects to close the transaction in the last quarter of this year.
Under the agreement, Taurus has agreed to acquire an iron ore royalty owned by De Beers related to the Onslow iron project in West Pilbara in Australia.
Taurus will also acquire the subsidiary company of De Beers that owns the royalty for upfront cash consideration of $125m, and a gold and copper royalty related to the Caspiche project in northern Chile for upfront cash consideration of $25m and up to $20m of deferred consideration.
Earlier this month, Anglo American said it would by the end of next year conclude a restructuring exercise that it announced after rebuffing BHP’s takeover bid. The strategy includes divestments from steel-making coal and diamonds as well as increasing its focus on copper and premium iron ore.
BUSINESS REPORT