Table of Contents
Key Points
- Peabody cancels $3.8 billion Anglo coal deal, citing Moranbah North mine fire as a material adverse change.
- Anglo plans arbitration for damages; Peabody seeks return of $75 million deposit from failed transaction.
- Anglo H1 2025 revenue drops to $8.95 billion; underlying EBITDA falls 20 percent to $2.95 billion.
Anglo American, a diversified global mining giant led by South African executive Duncan Wanblad, faced a major setback after Peabody Energy Corp. pulled out of its $3.8 billion deal to buy Anglo’s steelmaking coal assets.
Peabody cited a fire at Anglo’s Moranbah North mine in Queensland, saying it represented a material adverse change (MAC) and justified canceling the agreement. Anglo disagrees and plans to seek damages through arbitration. “Each side is confident in its own position from a legal perspective,” Jefferies analysts noted, warning that the dispute could weigh on both companies’ shares.
A strategic sale falls apart
The sale of the coal assets had been central to Anglo’s plan to simplify operations and raise cash, while also countering BHP Group’s $49 billion takeover attempt. The agreement had included Peabody reselling one of Anglo’s Australian mines to an Indonesian buyer.
With the collapse, Peabody is demanding the return of a $75 million deposit. This setback adds complexity to Anglo’s efforts to reduce its coal exposure. The London-based company has already spun off its platinum division and is weighing options for its struggling De Beers diamond unit, which has faced resistance from Botswana’s government.
Market response and industry challenges
Even after the deal fell through, Anglo’s shares rose 3.2 percent in London, while Peabody gained 7.5 percent in pre-market trading in New York. Analysts had previously questioned the price, noting that $3.8 billion was nearly twice Peabody’s market capitalization.
The failed deal also comes as coal prices soften and global trade faces headwinds. Although coal remains important for steelmaking, demand is weakening in the U.S. due to environmental regulations, high costs, and competition from renewable energy.
Peabody deal collapse challenges strategy
Founded in 1917, Anglo American now operates across copper, iron ore, platinum, diamonds, and nickel. Since becoming CEO in 2022, Wanblad has focused on streamlining the portfolio and building long-term value. In the first half of 2025, it reported revenue of $8.95 billion, down 7 percent from $9.58 billion a year earlier, while underlying EBITDA fell 20 percent.
The collapse of the Peabody deal highlights the hurdles Wanblad faces in reshaping Anglo while dealing with volatile commodity markets. Wanblad said the company has received interest from other buyers and remains confident it can sell the mines, though any new deal would likely occur under less favorable market conditions.
