Anglo Warns EU It Will Shut Brazil Mine If MMG Deal Blocked

European antitrust regulators are reportedly slated to face an ultimatum from Anglo American (LSE:AAL) approve the US$500 million sale of its Brazilian nickel division to Hong Kong's MMG Ltd (OTCPK:MMLTF), or watch the operations shut down entirely.

According to a Reuters report, Anglo American executives are fighting to salvage a transaction that has been stalled by the European Commission's Phase II regulatory review, which centers on fears that MMG could redirect critical nickel supplies away from European stainless steel producers.

The standoff highlights the EU’s growing anxiety over its reliance on China for battery and industrial metals. However, Anglo American intends to argue that blocking the deal will not protect European supply chains, but merely force the asset into retirement.

Ruben Fernandes, Anglo American’s chief CEO in Brazil, reportedly plans to tell the Commission that the company has no backup plan, having committed to exiting the nickel business more than two years ago.

"The protracted regulatory review has already caused considerable uncertainty locally, but the consequences of the EC prohibiting the sale of the business would be very troubling," Fernandes will say, according to prepared remarks obtained by Reuters.

"Recognising that MMG is the only credible buyer that we identified, and given our commitment to exit our nickel business more than two years ago, we will have little option but to head towards 'care and maintenance' as the pathway to closure in the event that the Commission prohibits the sale to MMG."

The contested transaction, originally struck in February 2025, covers the Barro Alto and Codemin ferronickel operations which jointly produced 39,400 metric tons of nickel in 2024, as well as two development projects, Jacaré and Morro Sem Boné.

The US$500 million structure is anchored by a US$350 million upfront cash payment, alongside a US$100 million price-linked earnout and a US$50 million contingency tied to future project investments.

With MMG Executive General Manager of Corporate Relations Troy Hey joining the defense in Brussels this week, the two miners have pushed the deal’s long stop date to October 31, 2026, leaving the immediate fate of the Brazilian mines entirely in the hands of the European Commission.

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Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.