BHP, Anglo American Sell Mine Stakes to Glencore in Shift from Thermal Coal -- Update

--Glencore agrees to buy Anglo American PLC and BHP Group PLC's stakes in Colombian coal mine for $588 million.

--Glencore agreed to acquire the interests after both Anglo American and BHP sought to sell their stakes.

--Anglo American said the sale is the final step in its move away from thermal coal.

By Joe Hoppe

Glencore PLC said Monday that it will acquire BHP Group PLC and Anglo American PLC's stakes in the Cerrejon coal mine in Colombia for $588 million, a deal which marks the end of Anglo's thermal-coal operations.

The mining company said it has agreed to acquire the 33.3% stakes of partners BHP and Anglo American on similar terms, with the aggregate consideration subject to purchase price adjustments calculated upon closing the deal.

Based on expected operating performance and current forward coal prices, and assuming the deal closes in the first half of 2022, Glencore expects cash generated by the operation to reduce the cash consideration to around $230 million.

The company said that it is taking stewardship of the mine after BHP and Anglo American put up sale notices, and that the alternative was one or more new partners compromising its sustainable operating environment or extending production beyond current concessions.

Anglo American said that the agreement marks the last stage of its transition away from thermal-coal operations, adding it has sought to balance the expectations of a wide range of shareholders.

BHP has previously said it intends to sell off its thermal-coal operations by the end of 2022. BHP said it expects a further impairment charge of around $80 million post-tax will be recognized as an exceptional item in the second half of fiscal 2021.

Glencore also said it has strengthened its emissions-reduction targets, including reducing its scope 1, 2 and 3 emissions by 50% by 2035 compared to 2019 levels, and setting a new short-term emissions reduction target of 15% by 2026 on 2019 levels.

Shares in London at 0720 GMT in Glencore were down 0.1% at 314.9 pence, in Anglo American up 0.2% at 2,971.0 pence and in BHP up 0.1% at 2,161.0 pence.

Write to Joe Hoppe at [e-mail]

(END) Dow Jones Newswires

June 28, 2021 03:50 ET (07:50 GMT)

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