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Agreement to sell Illawarra Metallurgical Coal

29 FEBRUARY 2024

We have entered into a binding agreement to sell IMC, expected to complete in H1 FY25.

South32 has today announced that we have entered into a binding agreement to sell Illawarra Metallurgical Coal to an entity owned by Golden Energy and Resources Pte Ltd (GEAR) and M Resources Pty Ltd for upfront and deferred cash consideration of US$1.3 billion plus contingent price-linked consideration of up to US$350 million. 

The sale is expected to complete in H1 FY25, subject to the satisfaction of certain conditions.  

"This transaction will realise significant value for our shareholders and is consistent with our strategy to reshape our portfolio toward commodities critical in the transition to a low-carbon future,” said Graham Kerr, South32 Chief Executive Officer. 

“It will streamline our portfolio, strengthen our balance sheet and unlock capital to invest in our high-quality development projects in copper and zinc.  The transaction will also simplify our business and reduce our capital intensity.” 

Illawarra Metallurgical Coal produces high-quality metallurgical coal, a key ingredient in the in the production of steel, which will be required in the steelmaking process until low-carbon steel becomes economically viable on a commercial scale.

GEAR and M Resources are established participants in the Australian metallurgical coal industry, with a strong commitment to environmental and safety standards, who are well positioned to continue Illawarra Metallurgical Coal’s contribution to the local steel industry and the Illawarra and Macarthur regions.

“Our focus remains the safe and reliable operation of Illawarra Metallurgical Coal,” said Graham.

“Over the coming months we will work with the Buyer, our workforce, the local community, government, customers and suppliers to support a successful transition of ownership.”

Click here to see the full market announcement (.pdf)