American coal producer Peabody has terminated purchase agreements with Anglo American for its Australian coal assets due to a material adverse change (MAC). The decision comes nearly five months after an ignition event occurred at Anglo’s Moranbah North mine.
Moranbah North was one of the four metallurgical coal mines included in the nearly $3.8 billion deal. The exact cause of the event remains unknown, with no definitive timeline for resuming sustainable longwall production at the operation.
“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,” said Peabody President and Chief Executive Officer Jim Grech.
“Peabody has chosen to terminate the transaction and will continue to execute our plans to create substantial value from our diversified global asset portfolio.”
Before the March 31 event, the acquisition was set to close in April 2025. Anglo estimates that the holding costs at Moranbah North amount to $45 million per month.
Peabody has also terminated the agreement for the related sale of the Dawson mine to PT Bukit Makmur Mandiri Utama.
Source: Peabody