Anglo American has sold its nickel arm for $787 million (US$500m) to a Singapore-based subsidiary of MMG as part of a plan to tighten its business.

The company’s nickel business comprises two ferronickel operations in Brazil – Barro Alto and Codemin – and two large greenfield growth projects, Jacaré and Morro Sem Boné.

The Barro Alto mine, Niquelândia mine, and the Barro Alto and Codemin ferronickel processing plants together produced 39,400 tonnes of nickel in 2024.

Jacaré is estimated to contain around 300 million tonnes of mineral resources, while Morro Sem Boné has a total potential mineralisation of 65Mt.

Upfront cash consideration

The agreed cash consideration consists of an upfront cash payment of $551m (US$350m) upon completion of the deal.

There is also the potential for a payment of up to $157m (US$100m) in a price-linked earn-out.

A further contingent cash consideration of around $78.7m (US$50m) is linked to a positive final investment decision for the development projects.

High-quality assets

Anglo American chief executive Duncan Wanblad said the sale followed a highly competitive process and marks an important milestone in simplifying the company’s portfolio to create a more highly valued copper, premium iron ore and crop nutrients business.

“Today’s agreement, together with those signed in November 2024 to sell our steelmaking coal business, is expected to generate a total of up to US$5.3 billion (approximately A$8.35b) in gross cash proceeds, reflecting the high quality of our steelmaking coal and nickel businesses,” he said.

“Anglo American’s portfolio focus, exceptional asset quality and growth options offer a differentiated investment proposition for investors.”

“We are unlocking the inherent value of all of Anglo American as we create a much simpler, more resilient, and agile business that will enable full value transparency in the market.”

Key diversifier

“We are excited by our acquisition of Anglo American’s nickel business, which provides important diversification for our business and strengthens our presence in Latin America,” MMG chief executive Cao Liang said.

“MMG and Anglo American have a long track record of close collaboration and shared values, demonstrated through our commitment to International Council on Mining and Metals principles.”

“This is a strong business with a talented team, growth potential, and demonstrated excellence in sustainability performance, and we look forward to continuing this positive legacy.”