US-based coal company Peabody Energy has terminated its previously announced $3.78bn acquisition of Anglo American’s Australian steelmaking coal business.
Peabody ended the agreement, initially signed in November last year, citing a material adverse change (MAC) related to Anglo’s coal assets.
The termination follows an ignition incident at Anglo’s Moranbah North Mine on 31 March 2025, with the cause remaining undetermined.
In addition to terminating the acquisition of Anglo’s assets, Peabody has also ended the sale agreement for the Dawson Mine to PT Bukit Makmur Mandiri Utama.
Peabody president and CEO Jim Grech said: “The two companies did not reach a revised agreement to cure the MAC that compensated Peabody for the material and long-term impacts of the MAC on the most significant mine in the planned acquisition.
“Peabody has chosen to terminate the transaction and will continue to execute our plans to create substantial value from our diversified global asset portfolio.”
“Peabody’s portfolio is very well positioned, with growing exposure to seaborne metallurgical coal highlighted by our new 25-year premium hard coking coal Centurion Mine, a low-cost seaborne thermal coal platform.”
The acquisition, slated to close in April this year, costs Anglo American $45m monthly at Moranbah North, with no clear timeline for production resumption.
Anglo American asserts that the ignition incident at Moranbah North does not constitute a MAC under its agreements with Peabody.
The company plans to initiate arbitration to seek damages for what it views as wrongful termination.
Anglo plans to work towards safely restarting the Moranbah North Mine and aims to conclude an alternative sales process.
Duncan Wanblad, CEO of Anglo American, said: “Despite our strongly held view, we believe that it would have been better for all parties to avoid a legal dispute.
“We continue to reserve our rights under the definitive agreements. We are confident in our legal position and will shortly initiate an arbitration to seek damages for wrongful termination.”
“We are confident that we will successfully conclude an alternative sales process for value in due course.”
