Anglo American Raises $400 Million in Discounted Share Placing of Platinum Unit — Update

By Christian Moess Laursen

Anglo American raised around $400 million after selling shares at a discount in its platinum subsidiary ahead of a demerger of the unit as part of a large-scale restructuring.

The diversified global miner said Wednesday that it sold 13.94 million shares, equating to an around 5.3% stake, at 515 South African rand ($28.70) each, a 9.7% discount on Tuesday's closing price.

The stake sale takes Anglo's shareholding in the South African subsidiary Anglo American Platinum to 73.3% from 78.6%.

The aim of the placing is to increase the amount of public shares, reduce the number of shares that will be given to Anglo American shareholders when the companies split, and help prevent a large selloff of shares after the split planned next year.

The London-listed miner is undergoing a groupwide restructuring after fending off a roughly $50 billion bid from Australian rival BHP in May. It plans to sell or spin off its platinum-metals, diamonds, coal and nickel units as part of the overhaul.

Anglo is under pressure to prove it can deliver value for shareholders via this strategy after rebuffing BHP's all-share offer.

Although the company hasn't given any guidance, it is possible there could be another sale in the first half of 2025, Deutsche Bank analyst Liam Fitzpatrick said in a note after Tuesday's news of the placing. A potential future sale might put pressure on Amplats shares in the near term, he added.

Amplats has suffered from persistently weak platinum prices, leading the company--which is the world's top platinum-metals miner by output--to book a 67% fall in adjusted earnings before interest, taxes, depreciation and amortization last year and announce cutting 3,700 jobs in February.

Its shares fell 8% to 525.10 South African rand in morning trade, widening its year-to-date fall to 46%.

Meanwhile, shares in Anglo American traded 0.4% higher, having been up 2% earlier in the session.

Settlement of the placing shares is expected to occur on or around Sept. 16.

Write to Christian Moess Laursen at christian.moess@wsj.com

(END) Dow Jones Newswires

September 11, 2024 05:45 ET (09:45 GMT)

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