Anglo completes Eskom exit
INCE CONNECT / 02 AUGUST 2018 - 15.55 / STEPHEN GUNNION
Anglo American has completed the sale of the New Largo thermal coal project and the Old New Largo closed colliery to black-owned companies Seriti Resources and Coalzar, and the Industrial Development Corporation. The three have combined to set up New Largo Coal Pty Ltd, which will pay Anglo R850 million for the assets.
New Largo is situated in Mpumalanga and its principal asset is the approximately 585Mt coal resource and the related mining right. Anglo says the mine is well-positioned to supply Eskom's new Kusile Power Station.
The global resources group has sold the last of its thermal coal assets tied to Eskom to a group led by Seriti Resources
The move completes Anglo's exit from Eskom-tied coal assets as it reshapes its global asset portfolio based on value and the optimal deployment of its capital. Earlier this year, it sold its New Vaal, New Denmark and Kriel collieries, as well as four closed collieries, to Seriti for R2.3 billion. Seriti is headed by former Optimum Coal CEO Mike Teke. The company is 72% black-owned and aims to become Eskom's biggest black-controlled supplier.
Anglo SA deputy chairman Norman Mbazima said the three parties had "excellent operating and management capabilities to develop and operate New Largo optimally and sustainably into the future".
This sale marks the completion of our long-standing strategy to exit our Eskom-tied coal assets and is yet another milestone in the sustainable transformation of the South African mining industry," said Anglo American SA deputy chairman Norman Mbazima.
Anglo's shares closed 0.3% lower at R296.84 yesterday.
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