Though one of the world’s major multinational mining companies, reporting a profit in 2019 of $4.6bn from its diversified operations across Asia, Europe, Africa, and the Americas, Anglo American has its historical home in South Africa. The country played host to the bulk of Anglo American’s early growth and diversification, and the recent announcement of an investment increase in the country over the next five years shows that Anglo American hasn’t forgotten those roots.
From its history with coal to its community initiatives, here are some of the key acquisitions and projects Anglo American has undertaken across its century-plus history in South Africa that have facilitated its global growth.
1917 – The early years
Anglo American has its roots in South Africa, founded in 1917 by Sir Ernest Oppenheimer as the Anglo American Corporation, with the initial financial backing from UK and US sources providing the Anglo and the American to the company name. Nine years later, in 1926, the corporation becomes the largest single shareholder in diamond company De Beers, and Oppenheimer becomes chairman of the diamond producer shortly after. Anglo American today owns 85% of De Beers, with the remaining stake held by the Government of Botswana.
1945 – Moving into coal
Anglo American enters the coal business in 1945 through its acquisition of Coal Estates. It begins the path for Anglo American to become a significant contributor to South Africa’s energy mix – to this day, the bulk of South Africa’s electricity comes from coal power.
1974 – Chairman’s Fund established
Anglo American launches its Chairman’s Fund in 1974, making it the first corporate social investment fund in South Africa to be professionally managed, and one of South Africa’s top corporate donors.
The vehicle through which Anglo American channels its corporate social investment spending, the Chairman’s Fund has historically invested across a range of areas, supporting community-based organisations that progress the company’s sustainable development commitments. The fund would later be rolled into the Anglo American Foundation, the company’s global programme that works to support initiatives addressing the United Nations’ Sustainable Development Goals.
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1989 – Community support through launch of Zimele
Anglo American coordinates its existing enterprise development initiatives in South Africa into one organisation, Zimele. Through partnering with industries, communities, and government, Anglo American’s dedicated enterprise development arm would go on to support more than 2,200 South African businesses.
Zimele – a word derived from the Zulu and Xhosa languages translated as “to be independent” – functions as an investment fund creating sustainable and commercially viable enterprises in South Africa. Against the backdrop of apartheid, Anglo American establishes Zimele to empower black entrepreneurs and equip them to participate in the mainstream South African economy.
1998 – AngloGold is born
AngloGold is formed in June 1998 through the consolidation of the gold and uranium interests of Anglo American and its associated companies in South Africa, creating a single independent gold company, with shares held by Anglo American. Six years later in 2004, AngloGold merges with Ashanti Goldfields to create AngloGold Ashanti, South Africa’s dominant gold producer at the time.
2002 – Building iron ore capability
In 2002, Anglo American announces its acquisition of shareholdings in Kumba Resources and Anglovaal Mining (Avmin), as part of its objective of securing a meaningful interest in the iron ore market. The company acquires a 34.9% stake in Avmin and an initial 9.6% in Kumba, with the right to acquire a further 10.5% in the latter. Four years later, Kumba Resources is restructured as Kumba Iron Ore, which Anglo American holds a majority stake in.
2018 – Anglo American launches sustainability strategy
Anglo American formally launches its Sustainability Strategy, which it terms an “ambitious and innovative” approach across three areas – the environment, community development, and driving greater trust and transparency across the mining industry.
The strategy outlines a number of goals for Anglo American to deliver by 2030, from reducing greenhouse gas emissions by 30% and improving energy efficiency by 30%, creating five off-site jobs for every direct mining job in host communities, and working with government to ensure every school in Anglo American’s host communities performs amongst the top 20% of state schools in the country.
May 2020 – Plans to exit South African coal
Speaking at Bank of America’s annual Global Metals, Mining, and Steel Conference, Anglo American chief executive Mark Cutifani mentions the company’s “expected exit from our thermal coal operations in South Africa in the next two to three years”. The company says for the first time that its preferred option for exiting the fossil fuel would be a demerger of its South African coal operations, with the unit potentially listed on the Johannesburg Stock Exchange within that two to three year timeframe.
November 2020 – Increasing South African investment
At the South Africa Investment Conference 2020, Anglo American announces an increase in its total investment commitment in the country to R100bn (around $6.63bn) over the next five years to 2025. It’s an increase of R15bn over its previous commitment to invest in sustaining or expanding its South African operations, as well as implementing green technologies. Investments include the conversion and expansion of the Venetia diamond mine in Limpopo to an underground operation and a new mine pit at Anglo American subsidiary Kumba Iron Ore’s Kolomela mine in Northern Cape.
The company’s investments in green technologies include initiatives like developing a world-first hydrogen-powered fuel cell mine haul truck at the Mogalakwena mine, and introducing bulk-ore sorting using new sensor technology to process in real-time a greater proportion of ore – creating less waste rock and saving energy and water in the process.