Anglo American expects final bids for coal business in 20

Anglo American expects final bids for coal business in 20

Anglo American’s Coal Divestment Progress Amid Evolving Market Dynamics

Anglo American (LON: AAL) continues to advance its strategic exit from thermal coal operations, with recent developments highlighting both challenges and opportunities in the sector. The company announced in August 2025 that Peabody Energy had scrapped a $3.8 billion bid for its coal assets, marking a setback in its divestment efforts. Despite this, Anglo American remains committed to finalizing bids for its coal business, with CEO Mark Cutifani emphasizing the need for disciplined capital allocation amid volatile market conditions.

The miner’s coal segment has faced declining profitability in recent years. In 2020, coking coal earnings plummeted to $50 million, compared to $1.7 billion in 2019, due to operational disruptions in Australia. To address this, Anglo American initiated a demerger of its South African thermal coal operations in 2021, transferring them to Thungela Resources Limited. The demerger aimed to create a standalone entity focused on exporting low-cost thermal coal while allowing Anglo American to concentrate on higher-margin commodities like copper and platinum.

While the Peabody bid’s collapse underscores the challenges of attracting buyers in a carbon-conscious market, Cutifani noted that other bidders have expressed interest in Anglo American’s coal assets. The company plans to complete the exit from its Cerrejón coal mine in Colombia within two to three years. Analysts suggest that the ongoing commodities rally, driven by strong demand for metals like copper, may redirect capital away from coal, aligning with Anglo American's broader sustainability goals.

Anglo American’s 2020 preliminary results highlighted a broader shift in priorities, with underlying EBITDA of $9.8 billion driven by resilient metals prices and a focus on low-carbon growth projects. The company reiterated its commitment to achieving carbon neutrality by 2040 and reducing net greenhouse gas emissions by 30% by 2030.

As the energy transition accelerates, Anglo American’s coal divestment strategy reflects a balancing act between maximizing asset value and aligning with global decarbonization trends. The outcome of pending bids will likely shape the final chapter of its coal operations, with implications for stakeholders and the broader mining sector.