Peabody Energy announces the termination of its agreements with Anglo American

Peabody Energy has made a press release announcing the termination of its agreements with Anglo American to acquire its steelmaking coal assets in Australia.

Ignition event

The decision follows the ignition event at Anglo’s Moranbah North Mine in March 2025, which has left the mine without a clear timeline for resuming longwall production at forecasted volumes and costs. Despite months of discussion, the two companies could not agree on revised terms to address what Peabody determined to be a Material Adverse Change (MAC) under the agreements.

Lack of agreement

James Grech, President and CEO of Peabody, stated: “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.”

Further, he underscored Peabody’s position of strength, highlighting: “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, and a leading U.S. thermal coal position capitalizing on rising power generation demand. Moving forward, we intend to execute a four-pronged strategy for value creation.”

Strategy

That strategy focuses on: operating safe, productive, and environmentally responsible mines, returning 65–100% of available free cash flow to shareholders, delivering organic growth from the existing asset portfolio, maintaining a resilient balance sheet with strong capital discipline

Anglo American statement

Anglo American, however, strongly disagrees with Peabody’s position. The company maintains that the Moranbah North incident does not constitute a Material Adverse Change under the agreements.

Duncan Wanblad, CEO of Anglo American, commented: “We are confident in our belief that the event at Moranbah North in March does not constitute a MAC under the sale agreements with Peabody. Our view is supported by the lack of damage to the mine and equipment, as well as the substantial progress made with the regulator, our employees and the unions, and other stakeholders as part of the regulatory process towards a safe restart of the mine. In fact, just in the last week we achieved a further important milestone, with our workforce signing off the risk assessment that underpins the restart strategy. We are therefore very disappointed that Peabody has decided not to complete the transaction.”

Moreover, in the Anglo American statement, Mr. Wanblad also addressed Anglo’s efforts to preserve the deal, the company’s next steps and confidence in Anglo’s asset base.