UPDATE 1-Anglo revises Brazil sale deal after port landslide
LONDON, Sept 25 (Reuters) - Global miner Anglo American has revised a deal to sell its Amapa iron ore operation in northern Brazil to Zamin Ferrous, following a landslide that sent machinery tumbling into the Amazon River and killed six people.
Anglo had agreed in January to sell its 70 percent stake in Amapa to former commodities trader Pramod Agarwal's Zamin for an undisclosed sum.
But the miner said on Wednesday that following the March landslide at the port serving Amapa, it had renewed discussions and bought out its minority partner, Cliffs Natural Resources .
Anglo will now sell 100 percent of the operation to Zamin for almost $270 million - an initial $136 million and a deferred, conditional further $130 million over five years, tied to the iron ore price. Anglo will also assume the risks and rewards of the insurance claim in relation to the port.
The landslide, the latest blow to Anglo's Brazilian ambitions, destroyed key infrastructure and left the miner unable to export from the port. Brazilian authorities have fined Anglo over the accident but the mining group has said there was no warning and the slide could not have been foreseen.
The announced sale price is a fraction of what Anglo paid for control of Amapa, in the very north of Brazil, when it bought the operation five years ago as part of the $6.65 billion Minas Rio acquisition from Brazilian billionaire Eike Batista.
An internal valuation by Anglo in 2011 put Amapa's value at $1.5 billion, meaning Anglo's 70 percent stake would be worth at least $1 billion, but that value tumbled as the iron ore price weakened and prospects for Chinese growth clouded.
Amapa was deemed non-core and officially put on the block last year, as the miner streamlines its portfolio. Anglo said on Wednesday it would use the proceeds to pay down debt.