Anglo completes R2.3bn sale of Eskom coal
Cape Town – Anglo American [JSE:AGL] has completed the R2.3bn sale of its South African thermal coal operations to black-owned mining company Seriti Resources.
The mining group announced the transaction in a note to shareholders on Thursday.
The sale is part of a strategy to reshape the group’s asset portfolio, according to CEO Mark Cutifani.
The operations which include New Vaal, New Denmark and Kriel collieries supply coal to Eskom’s power stations Lethabo, Tutuka and Kriel. The sale ensures the “reliable supply of coal” to the power utility, he said.
Seriti CEO Mike Teke said the mining company is committed to providing Eskom with “cost-effective, long-term coal supply solutions”.
Seriti also purchased closed collieries from Anglo and is a majority (84%) black-owned company. According to a statement from Seriti, 90% of its shareholding is equally held by black-owned investment companies Masimong and Thebe Investment Corporation, among others. The remaining 10% is held by employee and community trusts.
“We believe the conclusion of the sale to Seriti, a broad-based, majority black-owned and controlled South African mining company, represents a major step change in transformation in the coal (and broader mining) sector,” said deputy chairperson of Anglo American South Africa Norman Mbazima.
No job losses
Seriti will be engaging with operational staff and stakeholders to ensure a seamless ownership transition. It will absorb the Anglo American employees, who number about 3 000, as well as the more than 3 000 contractors.
Earlier this week Anglo also completed the sale of its Australian coal mine Drayton. The terms of the transaction were confidential.