Anglo American Agrees to Sell Australian Steelmaking Coal Assets for Up to $3.875 Billion

UK-listed miner to receive $2.3 billion upfront with remaining consideration tied to a price-linked earnout; proceeds earmarked to cut net debt

By Sofia Navarro AAL TECK

Anglo American PLC has reached an agreement to divest its Australian steelmaking coal portfolio to Indonesia-based Dhilmar Ltd for up to $3.875 billion in cash. The transaction includes an immediate cash payment of $2.3 billion, with the balance payable through a price-linked earnout. Anglo said it will apply the proceeds to reduce net debt. The sale follows the collapse of a prior agreement with Peabody after a production-stopping accident at the Moranbah North mine.

Anglo American Agrees to Sell Australian Steelmaking Coal Assets for Up to $3.875 Billion

AAL TECK

Key Points

Anglo American has agreed to sell its steelmaking coal mines in Australia to Dhilmar Ltd for up to $3.875 billion, with $2.3 billion payable up front and the remainder as a price-linked earnout - impacts mining and corporate finance sectors.
Proceeds from the sale will be used to reduce Anglo's net debt, affecting the company's balance-sheet position and potentially investor perceptions in equity and debt markets.
The disposal is part of Anglo's portfolio reshaping ahead of its planned merger with Teck Resources to form a company concentrated on copper and critical minerals - relevant to M&A and resources sectors.

Anglo American PLC announced on Monday that it has entered into a sale agreement to transfer ownership of its Australian steelmaking coal operations to Dhilmar Ltd, a company registered in the UK and based in Indonesia. The transaction is structured for a maximum cash consideration of $3.875 billion.

Under the terms disclosed, Dhilmar will pay $2.3 billion at completion, with the remainder of the purchase price subject to a price-linked earnout mechanism. Anglo stated that the cash proceeds from the deal will be used to lower the company's net debt.

The disposal forms part of Anglo American's broader strategy to reshape its portfolio as it prepares to move forward with a major combination with Canada-based Teck Resources. Anglo has described that transaction as a step toward creating a company focused on copper and other critical minerals.

This sale follows a previously announced agreement with Peabody aimed at divesting the same steelmaking coal assets. That earlier deal collapsed in 2025 after a serious accident at Moranbah North - identified as the most significant mine in the portfolio - halted production. Peabody terminated the purchase agreements in mid-2025 and subsequently initiated arbitration with Anglo over a dispute concerning a deposit amount tied to that aborted sale.

Anglo said it will continue to pursue the arbitration with Peabody even as it completes the transaction with Dhilmar.

Dhilmar is described in the company statement as a relatively recent entrant to the Australian market and is noted as having no major existing holdings in the country. The buyer is registered in the United Kingdom and based in Indonesia.

Context and implications

Anglo will receive an immediate cash inflow of $2.3 billion on completion, with further contingent payments subject to the earnout formula.
The divestment is intended to reduce Anglo's net debt, as stated by the company.
The transaction occurs while Anglo progresses with its planned merger with Teck Resources to concentrate on copper and critical minerals.

The company did not provide additional operational detail about the mines being sold or a timeline for completion of the Dhilmar transaction in the statement announcing the agreement.

Risks

The purchase price includes a price-linked earnout, creating uncertainty over the final amount payable - this presents contingent revenue risk for Anglo and valuation risk for Dhilmar.
An ongoing arbitration with Peabody remains unresolved after the earlier sale attempt collapsed following a production-halting accident at Moranbah North in 2025, which introduces legal and financial uncertainty tied to the prior transactions and deposits - relevant to legal and mining sectors.
Dhilmar is described as having no major holdings in Australia and is a relative newcomer there, which could pose execution or operational integration risks for the buyer and influence the performance of the acquired assets - affects mining operations and regional investment risk.

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Anglo American Agrees to Sell Australian Steelmaking Coal Assets for Up to $3.875 Billion

Key Points

Risks

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