Brazil’s competition watchdog, CADE, has reportedly initiated an investigation into the proposed sale of Anglo American’s nickel operations in the country, according to a Reuters report, citing the Financial Times.
The sale, which could reach up to $500m (2.73bn reais), is to a subsidiary of the Hong Kong-listed company MMG.
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This development follows a complaint by CoreX Holding, a direct competitor in the region.
CADE was quoted as stating: “Based on a complaint received, an Administrative Procedure for Investigating an Act of Economic Concentration was instituted.”
Although the investigation has commenced, CADE noted that this does not automatically imply that the transaction will be obstructed.
Anglo American has chosen not to comment on the situation, and requests for comments from CoreX and Brazil’s competition authority have not received responses.
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By GlobalDataThe investigation of the sale comes after Anglo American’s agreement with MMG in February to divest its Brazilian nickel business.
The company has been actively divesting and spinning off non-core assets, with a focus on copper and iron ore, following an unsuccessful takeover bid by its larger competitor, BHP, last year.
In addition to the nickel business, Anglo American is evaluating options for its unprofitable De Beers diamond division, which could involve a sale or listing.
Furthermore, Peabody Energy has recently withdrawn from its planned acquisition of Anglo American’s steelmaking coal assets, citing unforeseen challenges at the Moranbah North Mine.
The decision involved an ignition event from nearly five months ago that has left the timeline for resuming sustainable longwall production unclear.
