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Investing.com-- BHP Group Ltd (ASX:BHP) explored spinning off its Australian iron ore and coal divisions as part of a long-term pivot toward future-facing commodities like copper and potash, before ultimately shelving the idea, Reuters reported on Thursday citing sources familiar with the matter.
The mining giant considered a structure similar to its 2015 South32 (OTC:SOUHY) Ltd (ASX:S32) spinoff, with a likely Australian listing, but management decided against proceeding, the report said.
The discussions took place as BHP pushed to decarbonize its portfolio and prepared its bid for Anglo American (JO:AGLJ) PLC (LON:AAL) in 2023-24, according to the Reuters report.
A potential divestment would have marked a historic shift for BHP, severing ties with its decades-long dominance in Australian iron ore, which generates about 60% of its profits, Reuters reported.
However, the miner concluded it still needed the cash flow from these divisions to fund major investments in Chilean copper and Canadian potash, the report stated.
New BHP Chair Ross McEwan and the company’s leadership transition could reignite such strategic considerations in the future, the Reuters report added.