Non-core divestments and mana

RNS Number : 1960B

Anglo American PLC

22 October 2009

 



News Release

22 October 2009

Anglo American announces non-core businesses for divestment and streamlining of management structure

Anglo American plc ("Anglo American" or "the Group") today announces a number of changes across its businesses to create a more streamlined management structure and further focus the Group on its core mining portfolio.

Seven commodity business units ("BUs") are being created, with management teams located in the area of core geographic focus for the BU and responsible for operational performance and project delivery.  These are:

• Platinum (South Africa): CEO Neville Nicolau

• Copper (Chile): CEO John MacKenzie

• Nickel (Brazil): CEO Walter De Simoni

• Metallurgical Coal (Australia): CEO Seamus French

• Thermal Coal (South Africa): CEO Norman Mbazima

• Kumba Iron Ore (South Africa): CEO Chris Griffith

• Iron Ore Brazil (Brazil): CEO Stephan Weber

Five Group Directors, based in London, will be responsible for corporate functions, as well as providing strategic support to the BUs and ensuring the ongoing realisation of group-wide synergies.  They are:

• René Médori, Group Finance Director (who continues as a member of the Board)

• Brian Beamish, Group Director Mining & Technology

• David Weston, Group Director Business Performance & Projects

• Mervyn Walker, Group Director HR & Communications

• Peter Whitcutt, Group Director Strategy & Business Development

Anglo American's decision to divest certain non-core assets builds on the initiatives completed over the last three years, including the demerger of the Mondi Group and the sale of the Group's shareholdings in AngloGold Ashanti, Highveld Steel and Vanadium, Namakwa Sands and, most recently, Tongaat Hulett and Hulamin.  

Anglo American has determined that the following assets will be divested: Scaw Metals, Copebrás, Catalão and the Group's portfolio of zinc assets. Together with Tarmac, which has previously been identified as non-core, these assets accounted for approximately 11% of 2008 Group EBITDA.

Duncan Wanblad, as Group Director Non-core assets, will manage this portfolio as a standalone unit. The divestment of these assets will be undertaken in a manner and on a timetable that will maximise value for Anglo American's shareholders. Preparatory work for the separation of these businesses from the Group's core operations has commenced. Anglo American will provide further updates on the divestments as appropriate.

The business unit CEOs and Group Directors will report to Cynthia Carroll, Chief Executive, and together with her will form the Group's Executive Committee.

As a result of the reorganisation, a layer of global management is being removed. This will create a more effective, simple and efficient organisation, with greater clarity over decision making and greater speed of implementation. The delayering and other efficiency measures are expected to result in a reduction of overhead staff of approximately 25% with associated cost savings anticipated at US$120 million per annum.

Cynthia Carroll, Chief Executive, said: 

"I believe that these actions will position Anglo American well for sustained, profitable growth in the commodities we have identified as being the most attractive. The portfolio changes we have announced are the logical next step in focusing the Group on our core mining activities, enabling us to strengthen our balance sheet further.

"The delayering creates the opportunity for a new generation of executive management to come through and I look forward to working with them.

"I would like to thank Philip Baum, Ian Cockerill and Russell King for the key leadership roles they have played at Anglo. I have greatly appreciated their valuable contributions to the success of the Group and I wish them well for the future." 

Sir John Parker, Chairman, said: 

"Today's announcement represents an important step in creating a more streamlined business, with enhanced focus on operational effectiveness and project delivery.  We have a truly world class portfolio of assets and these initiatives further improve our ability to deliver its full potential." 

For further information, please contact:

United Kingdom

Nick von Schirnding, Head of Investor and Corporate Affairs

Tel : [phone]

James Wyatt-Tilby, Media Relations

Tel: [phone]

Caroline Metcalfe, Investor Relations

Tel: [phone]

Leisha Wemyss, Investor Relations

Tel: [phone]

South Africa

Anna Poulter, Investor Relations

Tel: [phone]

Pranill Ramchander, Media Relations

Tel: [phone]

Notes to editors

Anglo American plc is one of the world's largest mining groups. With its subsidiaries, joint ventures and associates, it is a global leader in platinum group metals and diamonds, with significant interests in coal, base and ferrous metals, as well as an industrial minerals business. The Group is geographically diverse, with operations in Africa, Europe, South and North America, Australia and Asia.

(www.angloamerican.co.uk)

Catalão

Catalão is a Brazilian producer of ferroniobium, a key element used in the strengthening of steel and for superconductive materials and superalloys, such as in jet engines or MRI scanners. 

In 2008, Catalão produced 4,600 tonnes of niobium, generating EBITDA of $80 million. Anglo American owns 100% of Catalão.

Copebrás

Located in the agriculturally-intensive Goías state of Brazil, Copebrás is a leading Brazilian producer of phosphate fertilisers and phosphoric acid, used to supplement natural soil nutrients in order to achieve high crop yields.

In 2008, Copebrás produced 982,100 tonnes of phosphates, generating EBITDA of $244 million. Anglo American holds a controlling interest of 73% of Copebrás.

Scaw Metals

The Scaw Metals Group (Scaw) is an international group manufacturing a diverse range of steel products. Its principal operations are located in South Africa, South America, Canada and Australia. Smaller operations are in Namibia, Zimbabwe and Zambia. The main product lines manufactured by Scaw are rolled steel (much of which is supplied to Scaw's downstream operations), steel and alloy iron castings, cast alloy iron and forged steel grinding media, chain, steel wire rope, strand and wire products. These are supplied to the global construction, railway, power generation, mining, cement, marine, engineering and agricultural markets.

In 2008, Scaw produced 771,000 tonnes of steel products in South Africa and 879,000 tonnes internationally, generating EBITDA of $309 million. Anglo American holds 74% of Scaw South Africa and 100% of Scaw International.

Zinc portfolio

Anglo American's portfolio of zinc assets includes the 100% owned Skorpion mine in Namibia and Lisheen mine in Ireland and the 74% owned Black Mountain mine and Gamsberg project, both in South Africa. In 2008, Anglo American's zinc businesses produced 340,500 tonnes¹ of zinc, generating EBITDA of $209 million.

¹ Attributable

 

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