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June 7, 2021, 10:41 a.m. EDT

Anglo American’s coal spinoff slumps in London debut

By Steve Goldstein

Anglo American’s thermal coal mining spinoff, Thungela Resources, is named after the isiZulu word for “to ignite,” but it did the exact opposite in its trading debut on the London Stock Exchange.

Thungela’s (JSE:ZA:TGA) shares fell to 111 pence from the opening level of 150 pence. The stock was greeted with a report, from short-selling research firm Boatman Capital Research, alleging that the environmental liabilities associated with closing mines could be three times greater than reported and more than the value of the whole company.

The company responded that its provisions were in line with industry standards, and that the South African draft regulation on which Boatman Capital based its assessment has been pushed back in any event.

Even without the short-selling report, analysts at Deutsche Bank had flagged there was “limited appetite from institutional European and U.S. based Anglo shareholders,” though they valued the company at 390 pence. Anglo American shareholders received one Thungela share for every 10 in Anglo they held.

Anglo American (LON:UK:AAL) shares slipped 2%.

Another stock on the move was flexible-office-space provider IWG (LON:UK:IWG) , which fell 8% , after warning that underlying earnings would be well below last year’s levels.

Cybersecurity firm NCC (LON:UK:NCC) was the top FTSE 350 mover, gaining 6%.

The broader FTSE 100 (FTSE:UK:UKX) rose 0.4% in afternoon trade.

Link to MarketWatch's Slice.