Anglo American is a long-standing client of MinterEllison. We have acted for Anglo American and the previous owner of its Australian business, Shell, since the early 1990s.

Our work for Anglo American covers its interests in Australia (M&A/corporate, disputes, operations and marketing) and on its global procurement.

Description

Anglo American appointed MinterEllison to advise on the divestment of all of its Australian coal mining assets (five mines in Queensland and two mines in New South Wales) in late 2014.

MinterEllison managed the legal aspects of the seven proposed disposal transactions, working closely with Anglo American's financial advisers, Bank of America Merrill Lynch and RFC Ambrian.

MinterEllison assisted Anglo American to successfully sell four of the assets, including its three thermal coal mines.

While interest in all assets was very strong and the sales processes for each were very advanced, following an upturn in the coal price and stabilisation of its balance sheet, Anglo American decided to retain its strong metallurgical coal assets (being the Moranbah/Grosvenor complex, Dawson and Capcoal mines in Queensland).

Our role

MinterEllison advised on all seven sales processes, including the four sales: the Foxleigh PCI mine to Realm Resources for an undisclosed value (completed 29 August 2016); the Callide thermal coal mine to Batchfire Resources for an undisclosed value (completed 31 October 2016); the Dartbrook thermal coal mine (on care and maintenance) to Australian Pacific Coal for approximately $50 million (completed 30 May 2017), and the Drayton thermal coal mine to Malabar Coal Limited (announced on 4 May 2017).

Our role involved all legal (including tax) aspects of the disposal transactions, including strategic advice and sales process, vendor diligence, data room preparation and operation, bidder engagement and bid review, as well as transaction document preparation and negotiation.

Throughout the sales, MinterEllison was required to deal with an extremely diverse group of bidders, including trade buyers, global mining houses, private equity and private wealth, with each requiring a different approach.

Value delivered

The transactions have focused and strengthened Anglo American's Metallurgical coal portfolio.

The deals have involved a number of innovative elements, including managing significant litigation, exposure to material mine rehabilitation, managing group port and rail contracts and liabilities, unbundling group procurement activities, joint venture issues including pre-empt and tag-alongs in interlinked sales across multiple joint ventures and novel royalties.