Anglo American plc

Anglo American plc
Public limited company
Traded as LSE: AAL, JSE: AGL
Industry Metals and Mining
Founded

1917 (Johannesburg)
(Anglo American Corporation)

1999 (London)
(Anglo American plc)
Headquarters London, United Kingdom
Johannesburg, South Africa
Area served
 Worldwide
Key people
 Sir John Parker
(Chairman of the Board)
Mark Cutifani
(CEO)[1]
Products Copper, diamonds, iron ore, metallurgical coal, nickel, platinum and thermal coal
Revenue US$20.455 billion (2015)[2]
US$2.038 billion (2015)[2]
US$ (5.842) billion (2015)[2]
Total assets US$ 52.01 billion (2016)[3]
Number of employees
 Approximately 135,000 (December 2015)[4]
Subsidiaries De Beers
Website www.angloamerican.com

Anglo American plc is a multinational mining company based in Johannesburg, South Africa and London, United Kingdom. It is the world's largest producer of platinum, with around 40% of world output, as well as being a major producer of diamonds, copper, nickel, iron ore and metallurgical and thermal coal.[5][6] The company has operations in Africa, Asia, Australasia, Europe, North America and South America.[7]

Anglo American has a primary listing on the London Stock Exchange and is a constituent of the FTSE 100 Index. The company has a secondary listing on the Johannesburg Stock Exchange.[6]

In December 2015 the company announced that after a US$3 billion loss in the first half of 2015, it would be undergoing a restructure, including the loss of 85,000 jobs out of 135,000.

History

1917 to 1990

Sir Ernest Oppenheimer founded the Anglo American Corporation in 1917 with financial backing from the American bank J.P. Morgan & Co. and £1 million raised from UK and US sources to start the gold mining company. This fact is reflected in the name of the company.[8] The AAC became the majority stakeholder in the De Beers company in 1926, a company formerly controlled by Alfred Beit, also a Jewish-German émigré.[9]

During 1945, the AAC moved into the coal industry by acquiring Coal Estates. Twelve years later, Sir Ernest died in Johannesburg and the company was succeeded by his son, Harry Oppenheimer, who also became chairman of De Beers. In the late 1940s and 1950s, the AAC focused on the development of the Free State goldfields (seven major mines simultaneously) and the Vaal Reefs mine. The success of the mines enabled the company to become the world’s largest gold-mining group.[10]

In 1961, the AAC expanded outside of southern Africa for the first time and became a major investor in the Hudson Bay Mining and Smelting Company in Canada. In 1967, the company moved into the steel industry by acquiring Scaw Metals. From 1967 to 1975, it continued to grow and established a number of ventures, including the Mondi Group (timber, pulp and paper), Amgold (later AngloGold Ashanti) and then Amcoal (through the consolidation of several of its mining operations in South Africa and later known as Anglo Coal and in 2010 changed to Anglo Thermal). In 1982, Harry Oppenheimer retired as chairman of the AAC and was succeeded by Gavin Relly. Two years later, Oppenheimer retired from De Beers and passed the chairmanship to Julian Ogilvie Thompson,[11] who in 1990 also became chairman and chief executive of the AAC.[12]

1990 to 2010

Sculptures outside Anglo American offices in London

Anglo American Corporation merged with Minorco on May 24, 1999 to form Anglo American plc with its primary listing on the London Stock Exchange and a secondary listing on the Johannesburg Stock Exchange.[13] Its gold mining operations were spun off into the separate AngloGold corporation, which in 2004 merged with the Ashanti Goldfields Corporation to form AngloGold Ashanti. Anglo American reduced its stake in AngloGold Ashanti to 16.6 percent in 2008.[14]

In 2000, Julian Ogilvie Thompson retired as chief executive of Anglo American and was succeeded by Tony Trahar. Ogilvie Thompson also retired as chairman in 2002 and was replaced by Sir Mark Moody-Stuart. In the same year, Anglo American acquired Tarmac, a supplier of building materials,[15] and Shell Petroleum Company’s Australian coal assets[16] In 2001, De Beers was privatised after being a listed company for more than 70 years.[17]

In 2002, South Africa’s Mining Charter was approved[18] and Anglo American and other mining companies with operations in the country were mandated to transfer a percentage of their South African production to historically disadvantaged South Africans.[19] From 2002 to July 2008 Anglo American carried out black community economic empowerment transactions (across all businesses with operations in South Africa) totalling R26 billion.[20] Also, in 2002, Anglo Base Metals acquired the Disputada copper operations in Chile from Exxon Mobil Corporation[21] and opened a representative office in Beijing, China.[22] In 2003, Anglo American acquired a major stake in iron ore producer Kumba Resources.[23]

In 2007, Cynthia Carroll succeeded Tony Trahar, becoming the first non-South African and first female chief executive of Anglo American.[24] The Mondi Group, a paper and packaging business, was also spun out in 2007.[25] During the next two years, Anglo American opened a representative office in New Delhi, India,[26] acquired control of the Michiquillay copper project in northern Peru and the MMX Minas-Rio and Amapa iron ore projects in Brazil[27] and later acquired stakes in the Pebble copper project in Alaska.[28]

Anglo American was also accused in 2007 of damaging environmental practices: in order to complete its planned Alaskan Pebble Mine in collaboration with Northern Dynasty Minerals, the global mining giant may build a massive dam at the headwaters of the world's largest sockeye salmon fishery, which it would risk obliterating.[29] Opponents are also pointing to the use of cyanide, heavy metals, and acid mine drainage which can all have potentially devastating effects on the pristine environment of the Bristol Bay area. Opponents of the Pebble Mine created Ballot Measure 4 to impose additional water quality standards on new large-scale mines in the state. However, in August 2007, Alaskans voted against the initiative.[30] The Pebble Limited Partnership has not yet put forward a project proposal and is working to prepare a Prefeasibility Study for the project in the second half of 2009.[31] The mine proposal must still undergo environmental studies and the permitting process, including being subject to state and federal water protections.[32] In December 2013, Anglo American withdrew from the Pebble Limited Partnership.[33]

2010 to present

Anglo American entered into talks in early November 2011, concluding on the 4th. The Oppenheimer family divested their remaining shares of De Beers, whereby Anglo American acquired an additional 40% stake for $5.1 billion, which increased Anglo American stake to 85%. This came at a time of increased labour strikes and international attention to Oppenheimer's involvement in blood and conflict diamonds.[34][35]

Anglo American Plc. sold a 24.5 percent share in its Chilean copper unit for $5.39 billion to Japan's Mitsubishi Corporation paid with a promissory note which is due on 10 November 2011. With this deal, the Anglo American Sur complex was valued at $22 billion.[36]

In November 2012, Anglo completed the sale of steel maker Scaw South Africa Ltd unit and its connected companies for a total of 3.4 billion rand in cash.[37]

In July 2014, Anglo American said it was disposing of its 50% shareholding in Lafarge Tarmac, a building materials joint venture, to cement maker Lafarge SA for a value of not less than £885 million ($1.5 billion).[38] The sale of Anglo American's 50% stake in Lafarge was subsequently completed in July 2015 for $1.6 billion.[39]

In October 2014, Anglo American's Minas-Rio iron ore project in Brazil, began operating and shipping ore.[40]

In July 2015, the company announced they would cut 53,000 jobs (35% of their employees) and that in the first half of 2015 they had a financial loss of US$3 Billion.[41]

In early December 2015 Anglo announced that, as part of a company restructure, they would be cutting 85,000 mining jobs worldwide, nearly two thirds of its current work force of 135,000.[4] Three businesses will be created by the merger of six divisions. The company has its' Dawson, Foxleigh and Callide coal mines in Central Queensland for sale. Dartbrook coal mine in the Hunter Valley in New South Wales is also for sale. Investors stock dividends were suspended. Anglo shares then dropped to a record low on the London Stock Exchange after falling more than 12 per cent.[42]

Operations

The company focuses on natural resources with six core businesses: Kumba Iron Ore; Iron Ore Brazil; Coal (thermal and metallurgical); Base metals (Copper, Nickel, Niobium, Phosphates); Platinum; Diamonds, through De Beers, in which it owns an 85% share.[43][44]

The paper and packaging business Mondi Group was spun out in 2007.[45] Anglo American entered into talks in November 2011 with the Oppenheimer family to divest the remaining Oppenheimer share of De Beers, an additional 40% stake for $5.1 billion, which would increase Anglo American stake to 85%. This came at a time of increased labour strikes and international attention to Oppenheimer's involvement in blood and conflict diamonds.[46]

In 2008, the company had 105,000 permanent employees and 39,000 contract employees in its managed operations located in 45 countries.[47]

Anglo American's biggest project, in recent times, was the Minas-Rio iron ore project in Brazil; it faced delays and high costs, but in December 2010 Anglo American gained a key license from the government that would allow work to start.[48][49] Production is initially expected to be 26.5Mt/y; iron ore would be sent through a 525 km slurry pipeline to the Port of Açu[50] As of October 2014, Minas-Rio is operational and shipping ore.[40]

In 2008, Anglo American (excluding De Beers) spent $212 million on exploring 21 countries for resources including copper, nickel, niobium phosphates and zinc.[51] The two main types of exploration for the company are Greenfield and Brownfield with nearly 70% devoted to Greenfield projects.[52]

Anglo American, along with De Beers, backed the manufacturing of a Superconducting Quantum Interference Device (SQUID) to help improve the sensitivity of exploration surveys.[53] Anglo American established Boart Products South Africa Limited in 1936 (later named Boart International) to turn the company’s stockpile of boart, or low-grade natural diamonds, into drilling products.[54] This initiative resulted in the development of the first mechanically set diamond drill bit and later led to additional research into cutting and abrasive tools.[55]

With a significant number of operations and employees in South Africa, Anglo American faces the HIV/AIDS challenge on a large scale.[56] In response, it runs a workplace program for HIV/AIDS testing and counselling.[57] In 2002, it started to provide antiretroviral drugs for employees with AIDS.[58]

See also

References

  1. ↑ "Anglo American appoints Mark Cutifani as Chief Executive". Retrieved 18 July 2013.
  2. 1 2 3 "Annual Report 2015" (PDF). Anglo American plc. Retrieved 19 March 2016.
  3. ↑ [NAME]. "The World's Biggest Public Companies List". Forbes.com. Retrieved 2016-09-27.
  4. 1 2 "Anglo American to cut workforce by 85,000 in restructuring". BBC News. British Broadcasting Corporation (BBC). 8 December 2015. Retrieved 9 December 2015.
  5. ↑ "At a glance". Anglo American plc. Archived from the original on 7 August 2010. Retrieved 31 August 2010.
  6. 1 2 "Anglo American Annual Report". investis.com. Retrieved 15 March 2015.
  7. ↑ "Where we operate". Anglo American plc. Archived from the original on 7 August 2010. Retrieved 31 August 2010.
  8. ↑ Forbes.com "New Mining Target: Anglo American" C.Noon.21 August 2006; Retrieved 27 May 2008.
  9. ↑ Chilvers, Henry (1939). The Story of De Beers. Cassell. p. 227.
  10. ↑ Answers.com "Anglo American"
  11. ↑ "At De Beers, the dynasty continues under a new name". New York Times. 3 March 1985. Retrieved 19 March 2016.
  12. ↑ "Anglo American chairman apartheid critic to retire". New York Times. 2 March 1990. Retrieved 19 March 2016.
  13. ↑ History Angola American PLC
  14. ↑ Anglo American website "AGM 2008 Chief Executive Speech" 15 April 2008
  15. ↑ thisismoney.co.uk "Tarmac takeover cleared" 1 March 2001. Retrieved 27 May 2009.
  16. ↑ Asia Times Online "Shell to shed coal to Anglo American" 2 June 2000. Retrieved 27 May 2009.
  17. ↑ New York Times."$17.6 Billion Deal to Make De Beers Private Company" 16 February 2001. Retrieved 27 May 2009.
  18. ↑ South Africa.info "Key empowerment charters" 29 October 2004. Retrieved 27 May 2009
  19. ↑ BBC News "South African mines charter welcomed" 10 October 2002. Retrieved 27 May 2009
  20. ↑ Mining Weekly "Employment equity next big transformation challenge for Anglo American South Africa – Baum" 8 July 2008. Retrieved 27 May 2009.
  21. ↑ Dallas Business Journal "Exxon Mobil completes Chile copper business sale" 13 November 2002. Retrieved 27 May 2009.
  22. ↑ Beijing Review.com.cn "Getting Down to Business" 26 April 2007. Retrieved 27 May 2009.
  23. ↑ Business Report(South Africa)"Anglo's stake in Kumba is now 66.6%" 9 December 2003. Retrieved 27 May 2009.
  24. ↑ Telegraph.co.uk "Anglo appoints first female head" 24 October 2006. Retrieved 27 May 2009.
  25. ↑ Mondi demerger approved by Anglo American shareholders Packaging News, 26 June 2007
  26. ↑ "Anglo American Plc keen on Indian tie-ups in mining" China Mining. 7 November 2008. Retrieved 27 May 2009.
  27. ↑ "Anglo American's $5.5 Billion Spending Spree" Forbes.com 17 January 2008.Retrieved 27 May 2009.
  28. ↑ "Queen Bee" Forbes.com 22 May 2008.Retrieved 27 May 2009.
  29. ↑ Vick, Karl. "Alaskans Weigh the Cost of Gold". The Washington Post. Retrieved 27 December 2007.
  30. ↑ "Alaska voters defeat tougher mining rules" MSNBC 28 August 2008. Retrieved 25 August 2009
  31. ↑ "Alaska voters validate State’s regulatory framework for mining" 4 September 2008. Retrieved 25 August 2009
  32. ↑ "Alaska Chooses Largest Gold Mine Over Clean Water" 29 August 2008. Retrieved 25 August 2009
  33. ↑ Goldenberg, Suzanne. "Anglo American pulls out of Alaska mines project". The Guardian. Retrieved 3 August 2015.
  34. ↑ "Anglo American in $5bn De Beers deal with Oppenheimers". BBC News. 4 November 2011. Retrieved 10 November 2011.
  35. ↑ "Anglo American raises stake in De Beers to 85 pct with $5.1B purchase of Oppenheimer stake". The Washington Post. 4 November 2011. Retrieved 10 November 2011.
  36. ↑ "Anglo Sells Chile Unit Stake in 'Bold' Bid to Thwart Codelco". Bloomberg. 10 November 2011.
  37. ↑ Dolan, David (26 November 2012), Anglo sells Scaw South Africa for $383 million, International: Reuters
  38. ↑ "Mining giant Anglo American to sell stake in Lafarge Tarmac for $1.5 bn". London Mercury. Retrieved 7 July 2014.
  39. ↑ Mark, Odell. "Anglo American completed sales of Lafarge-Tarmac stake". Financial Times. Retrieved 3 August 2015.
  40. 1 2 Kayakiran, Firat. "Anglo's Minas-Rio to Lift Ebitda by $560 Million, Bernstein Says". Bloomberg. Retrieved 3 August 2015.
  41. ↑ Patterson, Scott (24 July 2015). "Anglo American to Slash 53,000 Jobs as Commodity Price Falls Hit Results". The Wall Street Journal.
  42. ↑ Lannin, Sue (9 December 2015). "Anglo American to cut 85,000 mining jobs worldwide as part of restructure, four Australian mines remain for sale". Retrieved 9 December 2015.
  43. ↑ "At a glance". AngloAmerican.com. Retrieved 3 August 2015.
  44. ↑ "Anglo American completes acquisition of De Beers". Mining.com. Retrieved 3 August 2015.
  45. ↑ Anglo American (2007)History, Corporate website [accessed 21 July 2007]
  46. ↑ Anglo American to Pay $5.1 Billion for De Beers Stake, Wall Street Journal Retrieved 4 November 2011
  47. ↑ Anglo American Report to Society 2008 (2009)Anglo American Report to Society 2008 Accessed 1 June 2009
  48. ↑ "Anglo to start building Brazil mine, gets licence". Reuters. 12 December 2010. Retrieved 12 December 2010.
  49. ↑ "Mining Journal – Anglo secures key environmental permit for Minas-Rio". 12 December 2010. Retrieved 12 December 2010.
  50. ↑ "Project Profiles, Minas-Rio". 12 December 2010. Retrieved 12 December 2010.
  51. ↑ Anglo American Annual Report and Accounts 2008 (2009) Exploration Accessed 1 June 2009
  52. ↑ Anglo American corporate website (2009) What we do/exploration Accessed 1 June 2009
  53. ↑ African Review of Business and Technology (2007)High definition exploration brings better prospects Accessed 1 June 2009
  54. ↑ Advent International(2005)Advent to acquire Boart Longyear from Anglo American Accessed 1 June 2009
  55. ↑ Funding Universe Boart Longyear Company Accessed 1 June 2009
  56. ↑ "One Man's Drive... One Company's Courage" 19 December 2007. Retrieved 25 August 2009.
  57. ↑ "Anglo American's AIDS Initiative" 2 December 2005. Retrieved 25 August 2009
  58. ↑ "Mining Company to Offer H.I.V. Drugs to Employees" 7 August 2002. Retrieved 25 August 2009

External links

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