Anglo American PLC has signed an agreement to sell one of its largest Brazilian business for 9.7 billion yuan ($1.5 billion) to China Molybdenum Co. According to the Wall Street Journal, this represents another step of Anglo American's plan to sell its non-core assets and cut back debts.

Like Us on Facebook

The selling of Anglo's niobium and phosphate mines is a part of its plan to sell over 50 percent of its mines and shift focus to smaller group operations including copper, diamonds, and platinum. This is the biggest single sale Anglo has made after it announced in December and February that it plans to conduct widespread restructuring to raise between 19.4 billion yuan ($3 billion) and 25.9 billion yuan ($4 billion) worth of assets this year.

Anglo's niobium and phosphates units have a total revenue of 3.5 billion yuan ($544 million), with underlying operating profits of 770 million yuan ($119 million) in 2015, according to Financial Times. The unit includes manufacturing plants, mines, untouched mineral deposits, and marketing outlets in London and Singapore.

"The sale of our Niobium and Phosphates businesses is another positive step forward in the strategic reshaping of Anglo American that we set out in February," Mark Cutifani, Anglo American chief executive office, said.

The transaction also reflects the company's efforts to scrap off its net debt amounting to nearly 84.1 billion yuan ($13 billion). Anglo American also disposed of more than 12.9 billion yuan ($2 billion) worth of assets in 2015.

"The proceeds from this transaction, together with the ongoing productivity and cost improvements we are driving through the business, will enable us to continue to reduce our net debt towards our targeted level of less than $10bn at the end of 2016," Cutifani added.

Anglo's announcement was positively received by the market, with the company's share price climbing by three percent on the London Stock Exchange and 7.5 percent in Johannesburg.

TagsAnglo America, China Molybdenum, niobium, phosphates, minerals, mines