London - Anglo American [JSE:AGL] is working with Bank of America on an expanded sale process for its non-core coal mines in Australia, as it shrinks its business by more than half to weather the commodity price rout, people with knowledge of the matter said.
Anglo American is being advised by Bank of America on the divestment of its Moranbah and Grosvenor metallurgical coal assets, and it has started talks with potential buyers, according to the people, who asked not to be identified as the information is private.
Existing sale processes for Anglo American’s Dawson and Foxleigh coal operations, which are also being run by Bank of America, are continuing with final bids expected in the next few weeks, the people said.
Chief executive officer Mark Cutifani, who is trying to engineer a turnaround of the troubled miner, said this week that Anglo American would shed commodities like iron ore, coal and nickel to focus on producing diamonds, platinum and copper.
The company wants to raise $4bn from selling mines and reduce net debt to less than $10bn this year.
A representative for Bank of America declined to comment. A spokesperson for Anglo American declined to comment on the advisers for the sale. She referred to a February 16 statement which confirmed a sale process for the Moranbah North, Grosvenor and Moranbah South assets was under way.
Anglo American owns 88% of the Moranbah North mine, which is located in Queensland state’s Bowen Basin and has annual output of 4 million metric tons of coking coal, according to its website. The nearby Grosvenor project is about to begin production.
Last year, Anglo American hired Bank of America to sell a portfolio of four Australian coal mines including Foxleigh and Dawson, according to a person familiar with the matter at the time.
The miner agreed in December to sell its Dartbrook coal asset in Australia for about $36m to Nathan Tinkler’s Australian Pacific Coal. It also sold the Callide open-pit thermal coal mine last month to Batchfire Resources Pty for an undisclosed amount.