Anglo American sells off Tarmac's Continental arms
SOUTH African-focused mining group Anglo American hit another milestone in its restructuring yesterday, as it announced the sale of its European Tarmac operations for $400m (pounds 255m).
Tarmac’s construction aggregates businesses in France, Germany, Poland and the Czech Republic will be sold to Eurovia, a subsidiary of the French construction giant Vinci Group.
In a separate transaction, Tarmac’s Polish concrete products business has been sold to Innova/4, a Central European private equity fund advised by Innova Capital.
The units sold made up approximately 20pc of Tarmac’s profits last year – the bulk of its business is in the UK. The UK operation has yet to be sold.
Tarmac was initially highlighted as a non-core asset for disposal in 2008, but the sale was scuppered by a freezing of credit markets. Anglo American, under chief executive Cynthia Carroll, has been under pressure to dispose of non-core businesses and cut costs after a “merger of equals” approach by Xstrata last year.
This follows news last week that two of its subsidiaries – 80pc-owned Anglo Platinum and 45pc-owned De Beers, were to recapitalise balance sheets through rights issues.
Anglo Platinum is raising $1.6bn in total and De Beers $1bn. Anglo American will take part in both share issues to maintain its stakes.
The $400m raised
in this sale is a lower
amount than the group’s liability for its participation in the De Beers rights
issue, but analysts greeted the sale warmly.
However, Peter Davey, an analyst at broker Ambrian, yesterday warned investors not to expect Anglo American to reinstate its dividend when it releases full-year figures on Friday. He argued that “given the cash calls announced last week and the lack of cash dividend inflows” it was “exceptionally unlikely”.
Anglo American shares rose 90p to pounds 24.39.