viewAnglo American PLC

Sirius Minerals buyer Anglo American reassures on mining production growth

“We have delivered our full year production targets across the business,” said chief executive Mark Cutifani

Anglo American plc -
Minas Rio in Brazil

Anglo American plc (LON:AAL), the mining giant that has agreed to take over Sirius Minerals PLC (LON:SXX), confirmed production volumes for the last quarter of 2019 were up 4%.

Production in the fourth quarter was led by growth in iron ore, platinum, palladium and metallurgical coal, while diamond production from its De Beers business and copper both declined.

READ: Anglo American confirms formal recommended Sirius Minerals takeover offer

“We have delivered our full year production targets across the business,” said chief executive Mark Cutifani.

Iron ore was boosted as Minas-Rio in Brazil ramped-up further, with the mine being Anglo’s best-performing asset in 2019 and after recently receiving an operating licence for a tailings dam is expected to continue delivering volume growth in coming years.

Copper was hit by the drought in Chile impacting water availability at its Los Bronces mine, while production was lower from De Beers its Venetia mine in South Africa moved to underground extraction and Victor in Canada reached the end of its mine life.

Anglo made no comments on the Sirius Minerals offer, which was made formally at a price of 5.5p per share on Monday, valuing the Yorkshire potash miner at £404.9mln.

With the offer price almost 80% below last year’s high, after its attempts to raise project financing failed, Cutifani acknowledged in a recent interview that for the legions of disappointed investors it was “tough”.

“From our point of view, we understand that people are disappointed,” he told a local radio station in Yorkshire this week.

“We understand that they're disappointed that in the case where they've bought for a higher price, that they would be losing money - but we would think that the certainty that we bring is very important, in terms of where the business is today.”

Quick facts: Anglo American PLC

Price: 1975 GBX

Market: LSE
Market Cap: £26.94 billion

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