Anglo reshuffles Kumba Iron Ore management ahead of sale
Anglo American (LON:AAL) has appointed Themba Mkhwanazi as the new chief executive of Kumba Iron Ore as the company readies to divest the unit.
Mkhwanazi, who currently leads Anglo’s South African coal unit, takes over on Sept. 1 from Norman Mbazima, who’s stepping down after four years at the job, the company said in a statement.
Kumba’s net cash position has improved substantially. It was at 548 million rand by June 30 compared with net debt of 4.6 billion rand on Dec. 31.
Mbazima will remain deputy chairman of Anglo’s South African division and will be in charge of overseeing the sale of the company’s non-core assets in the country, which include Kumba (JSE:KIO) itself as well as Anglo’s thermal coal businesses.
The company, however, is still debating whether to sell or spin off its majority stake in Kumba Iron Ore Ltd, Africa's top producer of the commodity.
A drastic fall of iron ore prices affected Kumba last year forcing it to halve production at its Sishen mine and cut about 31% of its workforce. But in the first six months of the year the division reported earnings of 3 billion rand ($210 million), up 20% when compared to the previous year. Output dropped by 21%t, in line with Sishen’s revised plan.
“This time last year, Kumba was facing a significantly deteriorating price environment which brought about immense change to the industry,” departing CEO Mbazima said in a separate statement.
Since then, Kumba’s net cash position has improved substantially. It was 548 million rand at June 30 compared with net debt of 4.6 billion rand on Dec. 31. However, the miner won’t yet resume paying dividends.
Anglo American’s 70% stake in Kumba Iron Ore is valued at about $2 billion.