Anglo American set to vote on coal demerger
Anglo American has announced details of shareholder voting arrangements for the planned demerger of its South African coal assets.
Multinational mining company, Anglo American plans to demerge from its South African thermal coal assets, subject to the approval of 75 percent of its shareholders at a “court meeting” to be held on 05 May 2021.
Anglo's South African coal activities account for around 3 percent of the company's Ebitda (earnings before interest, taxes, depreciation, and amortization), making them a minor part of the company's overall operations.
The demerger entails the transfer of Anglo American's thermal coal operations in South Africa to a new holding firm, Thungela Resources, as well as the demerger of Thungela shares to Anglo American shareholders and the main and standard listings of Thungela's shares on the JSE and the London Stock Exchange. Operating assets and liabilities previously under Anglo Operations Proprietary Limited, as well as the entire issued share capital of South Africa Coal Operations Proprietary Limited (Saco) will also be transferred.
“The demerger is part of a planned and responsible transition away from thermal coal as the world transitions to a low carbon economy,” said Mark Cutifani, Anglo American, CEO.
Anglo shareholders will own 100 percent of Thungela's issued share capital after the proposed merger is completed, and they will receive one Thungela share for every ten Anglo American shares they own. Shareholder will further keep their existing shareholding in Anglo American.
Thungela is one of the largest pure-play producers and exporters of thermal coal in South Africa. The coal producer will retain 90 percent of their local thermal coal operations with the remaining 10 percent going to employees though an employee partnership plan and a community partnership plan. Once the transaction is completed, Thungela will have its own separate listing on the JSE and London Stock Exchange.
Anglo has also committed to supporting Thungela as a separate entity together with an initial investment of R2.5 billion.
In observing Covid-19 safety guidelines, the “court meeting” will be a closed physical meeting with voting scheme shareholders requested not to attend.