Glencore to Acquire BHP & Anglo Shares in Cerrejón Coal Mine
Following notices from joint venture partners, BHP and Anglo American, offering to sell their entire shares in the Cerrejón mine in Colombia, Glencore has reached agreement with each of them on substantially the same terms to acquire their respective 33.3% interests. The transaction has an economic effective date of 31 December 2020, with an aggregate purchase consideration of c. USD 588 million then being subject to purchase price adjustments calculated at closing. Glecore said “Based on expected operating performance and current forward coal prices, assuming a closing during H1 2022, we anticipate the cash generated by the operation to reduce the effective aggregate cash consideration to approximately USD 230 million, making the estimated investment payback period less than 2 years from closing.”
The transactions are subject to various regulatory approvals and are inter-conditional on each other.
Cerrejón is an open-pit coal-export mining operation in Colombia. The company plays an important role in the Colombian economy and in the region of La Guajira, where it operates a mine, railroad and port facilities.
The gross assets of Cerrejón are USD 2.968 billion. The loss attributable to Cerrejón in the year ended 31 December 2020 was USD 226 million.