It was 2012 and Anglo American was half a decade into a multibillion-rand bet on iron ore in Brazil. In SA the platinum sector, in which it controlled the largest producer, was looking increasingly unstable.
Anglo was pushing deeper into the commodities that China's growing economy was demanding, notably iron ore. Specifically the Minas Rio project in Brazil, which soon turned into a story of cost overruns and delays. And it did not help that the 2008 financial crisis and the global recession that followed pulled the rug out from under commodity prices.
The stage was set for a rejigging of the company. And that is what happened.
At this year's AGM, chair Stuart Chambers said the company was radically different in shape, quality and performance. Also speaking at the AGM this week, Mark Cutifani, who took over in early 2013, called the company a fundamentally different business.
Cutifani, who ran AngloGold Ashanti before taking the reins at Anglo, had taken a long, hard look at the company's global portfolio and jumped in with a pair of scissors.
"Since 2012, we have halved the number of assets, significantly upgrading the performance of each remaining asset, which has reinforced the sheer quality of the portfolio and our operating model impact," he said.
Though some South African assets were also sold off, Anglo is quick to point out that it is still heavily invested in the country. And it is knuckling down with a further R70bn over the next five years. Anglo Platinum and Kumba Iron Ore are important parts of the group's business.
Double productivity
And the company is very interested in getting the most out of what it has left.
"We are now delivering 30% more product from each retained asset, translating into 10% more physical product in aggregate across the portfolio at a 26% lower unit cost (in nominal terms), driving a doubling of productivity per employee," Cutifani said.
And Anglo now has the look of a more global group. A third of its business is in South America these days. And despite paying out $2.6bn (R37.3bn) in dividends over the past two years and lowering debt by about $10bn, the shift has not been universally popular.
Vedanta chair Anil Agarwal, who holds a 19.3% stake in Anglo, has been vocal in his opposition to South American expansion, punting SA's mining credentials on more than one occasion.
At the AGM Agarwal voted against the re-election as director of Marcelo Bastos, a South American mining veteran, but did not have enough support to have him removed.
But the numbers seem to suggest that the broad strategy — which also includes more copper mines in South America — is paying off.
"We have driven our mining margin up from 30% in 2012 to 42% today, and that's with a lower price basket," said Cutifani.It would not be the first time Anglo did a big chop and change.During SA's years of economic isolation the group bought all sorts of assets. It became a conglomerate and controlled a string of divergent businesses. Since listing in London in the late 1990s, it has made a big effort to shed all its non-mining businesses. Despite this push, as recently as the middle of the last decade Anglo still had paper and packaging group Mondi in its stable, and sugar producer Tongaat Hulett.So it shifted from conglomerate to global miner. And then from global miner to leaner global miner.And Cutifani maintains that the company now has its pick of a number of attractive low-cost, high-return options it can exploit in its own business."So, unlike a number of our peers, we don't need to go out and buy growth."strydomt@sundaytimes.co.za..