Anglo American completes takeover of UK potash mine

Anglo American has completed its acquisition of Sirius Minerals, a UK mining company that also owns a fertiliser business, after the takeover secured court approval, it was announced on Monday. 

Sirius's Woodsmith Project produces polyhalite, a mineral salt used as fertiliser and for other industrial applications. It has faced financial difficulties linked to Brexit. 

The company did not reveal the value of the transaction, but it is said to be worth £405 million (R8.1 billion).

Anglo American CEO, Mark Cutifani, hailed the takeover as a "new chapter for the Woodsmith Project" - saying the business had potential of producing premium quality, low carbon fertiliser.

"The project itself offers the prospect of sustained employment and economic stimulus for North Yorkshire and Teesside for many decades to come and, when the mine is ramped up, a boost in exports to benefit the wider British economy," said Cutifani.

Sirius had last year abandoned plans to raise £400m to fund the Woodsmith Project, blaming both Brexit and a lack of government support. It warned that it only had enough cash to last a couple of months.

Sirius' shares lost more than 80% of their value last year.

Coronavirus slowdown

Anglo American, which has operations around the world, also announced that it would be slowing down operations its Quellaveco copper project construction in Peru, as part of measures to curb the spread of coronavirus, after the government announcement a 15-day national quarantine.

The diversified global mining giant said construction work on the project would be "significantly slowed, with only critical areas of the project continuing as normal, until such time as workers can return safely."

The Quellaveco project is expected to begin production in 2022, and the temporal slowdown is not expected to result in delays as work was ahead of schedule.

Once complete, the project is expected in its first ten years of full production to produce nearly 300 000 tonnes per year at a cash cost of $1.05 per pound of copper, according to the company.