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09 November 2011

Anglo American sells 24.5% interest in Chilean copper assets to Mitsubishi Corporation for US$5.39 billion

Anglo American plc (“Anglo American”) announces the completion of its sale of a 24.5% interest in Anglo American Sur SA (“AAS”), comprising certain of Anglo American’s copper assets in Chile, to Mitsubishi Corporation (“Mitsubishi”) for US$5.39 billion.

Anglo American’s transaction with Mitsubishi has enabled Anglo American to realise an attractive valuation for a minority stake in AAS, valuing 100% of AAS at US$22 billion. AAS includes the Los Bronces and El Soldado copper mines and the Chagres copper smelter. The US$5.39 billion sale price has been paid in the form of a promissory note delivered by Mitsubishi, which is due on 10 November 2011. The transaction is unconditional and was completed immediately following agreement of the terms of the transaction.

Anglo American has regularly reviewed its available alternatives and, following a thorough assessment, and in the interests of its shareholders, it entered into a process to explore the potential value of the AAS assets through the evaluation of a sale of a minority stake in AAS. Following this transaction, Anglo American holds a 75.5% interest in AAS.

The transaction is fully compliant with the provisions of the option agreement between Anglo American, certain of its affiliates and Codelco, which expressly contemplates the eventuality of Anglo American disposing of its AAS shares at any time prior to the date on which the option may be exercised and therefore no longer holding 100% of the shares in AAS. In such an eventuality, the percentage of shares in AAS over which Codelco may exercise its option is reduced by the percentage of shares in AAS not held by Anglo American at the time of exercise. The option is exercisable only during the month of January every three years until January 2027.

Cynthia Carroll, Chief Executive of Anglo American, said: “We are delighted to welcome Mitsubishi as a 24.5% minority investor in AAS. Mitsubishi brings both its global reputation as an industrial powerhouse and extensive experience as an existing investor in Chile. The terms of the transaction completed with Mitsubishi highlight the inherent value of AAS as a world class, tier one copper business with extensive reserves and resources and significant further growth options from its exploration discoveries, valuing 100% of AAS at US$22 billion.

Mrs Carroll added: “Anglo American has a substantial portfolio of high quality mining businesses in Chile, having invested US$6.5 billion since 1980 and employing more than 10,000 Chileans, while our future growth ambitions have the potential to bring significant further investment and employment to Chile. Our approach is to build long term partnerships with national and local governments and to support local communities in countries in which we operate. We have been among the first to offer assistance to Chilean communities and to government in times of need, for instance following last year’s devastating earthquake when we mobilised significant resources to work together to rebuild and equip a number of schools in the area most affected.”

Sir John Parker, Chairman of Anglo American, added: “The sale of an interest in AAS demonstrates the Board’s commitment to delivering value for our shareholders, in line with the contractual alternatives available to us in our agreement with Codelco. Anglo American remains fully committed to its major inward investment programme in its Chilean business and to continuing its significant social and community investment programme in Chile.”

Anglo American is one of Chile’s largest inward investors, with US$6.5 billion of investment in the mining industry since 1980, and has substantial future growth options in the country through a number of multi-billion dollar brownfield and greenfield projects over the next decade. Anglo American employs more than 10,000 Chileans directly, supports many thousands more indirectly, and has paid US$4.5 billion in taxes in Chile in the last five years. A leader in social responsibility, following the earthquake in Chile in 2010, Anglo American donated US$10 million, expertise and equipment and worked with the government to reconstruct and equip six schools, enabling 4,500 children and teachers to resume classes just three and a half months after the earthquake. Anglo American has also committed US$3 million to work in partnership with the Ministry of Housing and City Planning, together with Un Techo para Chile, to help more than 4,500 families in shanty towns across the metropolitan area of Santiago.

Anglo American intends to use the proceeds of the transaction for general corporate purposes.

Additional information:

Anglo American is one of the world’s largest mining companies, is headquartered in the UK and listed on the London and Johannesburg stock exchanges. Anglo American’s portfolio of mining businesses spans bulk commodities – iron ore and manganese, metallurgical coal and thermal coal; base metals – copper and nickel; and precious metals and minerals – in which it is a global leader in both platinum and diamonds. Anglo American is committed to the highest standards of safety and responsibility across all its businesses and geographies and to making a sustainable difference in the development of the communities around its operations. The company’s mining operations and extensive pipeline of growth projects are located in southern Africa, South America, Australia, North America and Asia. www.angloamerican.com

Anglo American Sur SA, a subsidiary of Anglo American, holds a significant portfolio of copper assets in Chile, including the large open pit Los Bronces mine, the open pit El Soldado mine and the Chagres smelter. For the year ended 31 December 2010, AAS generated an EBITDA of US$1.3 billion, had net assets of US$3.2 billion and gross assets of US$4.9 billion. The portfolio has extensive JORC compliant proven and probable reserves of 2.4 billion tonnes plus additional resources of 6.4 billion tonnes, together with excellent exploration upside. There are a number of projects currently under evaluation that have significant potential to enhance near term performance and deliver long term growth. In addition, exploration activities point to further potential to expand resources at existing operations. Operations, project development and the exploration programme are led by a highly experienced Anglo American management team, including John Mackenzie (CEO) and James Beams (CFO), with established relationships with local partners and agencies, supported by leading technical expertise, project development skills, and a global platform.

Mitsubishi Corporation is a global integrated business enterprise that develops and operates across virtually every industry, including industrial finance, energy, metals, machinery, chemicals, foods and environmental businesses. Mitsubishi’s current activities are expanding far beyond its traditional trading operations as its diverse business ranges from natural resources development to investment in retail business, infrastructure, financial products and manufacturing of industrial goods. With over 200 bases of operations in approximately 80 countries worldwide and a network of over 500 group companies, Mitsubishi Corporation employs a multinational workforce of nearly 60,000.

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For further information, please contact:

Media

UK
James Wyatt-Tilby
Tel: +44 (0)20 7968 8759

Emily Blyth
Tel: +44 (0)20 7968 8481

South Africa
Hulisani Rasivhaga
Tel: +27 (0)11 638 4401

Chile
Marcelo Esquivel
Tel: +56 2 230 6584

Investors

UK
Leng Lau
Tel: +44 (0)20 7968 8540

Caroline Crampton (neé Metcalfe)
Tel: +44 (0)20 7968 2192

Leisha Wemyss
Tel: +44 (0)20 7968 8607

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