Anglo American Prepares for Significant Restructuring as Platinum Demerger Approaches

Anglo American is on the cusp of a significant transformation as it plans to spin off its platinum business, with UBS highlighting a potential rerating of its stock. This strategic move aligns Anglo American more closely with copper, a sector that commands higher valuation multiples. UBS anticipates that by 2026, 70% of Anglo's EBITDA will stem from its robust copper assets, positioning it as one of the most attractive global mining majors. The demerger, set for May 31, removes a major barrier for potential corporate bids. BHP, among other suitors, may revisit its acquisition interest. As Anglo exits platinum, De Beers, and met-coal, its asset base becomes streamlined, easing full takeover considerations. However, Peabody's withdrawal from a met-coal acquisition due to operational issues at the Moranbah North mine presents a complication. Despite these challenges, UBS maintains a buy rating with a revised target price of 2,750p, recognizing a substantial upside potential. Anglo's strategic pivot to copper and simplification of its asset portfolio could lead the market to reevaluate its worth, providing potential catalyst-driven price appreciation even without an immediate bid.