Anglo American to Ditch Diamonds and Platinum, Considers De Beers IPO

Anglo American Plc is implementing strategic changes to unlock shareholder value and enhance returns. This includes exiting diamond, platinum, and coal mining operations, marking one of the most significant shake-ups in the company's 107-year history.

Key to this plan is the demerger or sale of its De Beers diamond business, alongside separating its Anglo American Platinum unit and divesting coking coal mines in Australia. Additionally, spending on a fertilizer mine project in England will be scaled back.

As outlined in their strategy, Anglo American shared they had made significant progress towards finalizing the sales agreement with the Government of the Republic of Botswana. They are exploring the full range of options to separate the De Beers business. “Today’s announcement from Anglo American opens up new possibilities under new ownership", said Al Cook, CEO of De Beers Group. "In particular, we look forward to finalizing our transformational agreement with the Government of the Republic of Botswana, who hold a 15% ownership interest in De Beers".

In a later update, Reuters reported that Anglo is considering a De Beers IPO, citing sources familiar with the matter, saying the process is still at an early stage.

Later this month the company intends to present a new strategy for De Beers. "With the ongoing recovery in rough diamond demand and such a positive outlook for the sector, I feel very confident in our future,” he concluded.

These decisions come as Anglo American aims to rebuff takeover bids from BHP Group. The company asserts that these bids undervalue it and are structurally unworkable. Anglo American seeks investor support for its strategic vision and confidence in management’s execution capabilities. This strategic pivot aims to streamline operations, focus on core strengths, and enhance shareholder value in the long term.

photo credit: Anglo American