Together with

Contents

• EDITOR’S RAMBLE 🗣

• FEATURED REPORT 📰

• IN OTHER NEWS 🗞

• OPEN TABS 🌐

• STUFF THAT MIGHT HELP YOU 👌

EDITOR’S RAMBLE 🗣

I'm excited to partner with Linklaters for today's newsletter!

It's a special one for us because, at $11 billion, I think Valterra is the biggest transaction we've ever broken down. We spoke with the Linklaters team who ran it, so we’ve managed to go deep into this one.

Another reason this one made me happy is that yesterday, a friend messaged me on LinkedIn – turns out she'd worked on this exact deal when she was a trainee.

That message has unlocked a new ambition for me.

My goal with LittleLaw is for you to break into a career in law. And as we partner with law firms in the coming years, I think it would be so cool for a reader of this newsletter to start their legal career, and one day contribute to the breakdowns they used to read.

Together, let’s make that happen! 💪

– Idin

P.S. Last week, the LittleLaw Pulse prize winners were decided after a live race of over 1,000 virtual marbles (yes, really). We gave away a MacBook Air, an Amazon Kindle and Apple Airpods. Two of the prizes are claimed, but one winner still hasn't replied to us... so if you entered the survey, check your inbox and spam folder – there's an unclaimed prize with someone's name on it. 👀

FEATURED REPORT 📰

​⛏️ How Linklaters helped spin off an $11 billion platinum giant

What’s going on here?

In 2025, with the help of Linklaters, Anglo American demerged its platinum business, Anglo American Platinum (AAP). The result was a fully standalone company called Valterra Platinum, valued at around $11 billion.

Anglo American is one of the world's biggest mining groups, best known for producing copper and iron ore. Until last year, it also controlled AAP, its South African platinum business (through its majority shareholding interest).

Most demergers are tidy-up exercises. The parent company decides that a part of the business no longer fits, separates it out, and lets shareholders own the two separate pieces directly.

Anglo American's demerger was part of a wider strategic move.

Why did Anglo American want to separate its platinum business?

Anglo American was a conglomerate – a single group holding several mining businesses (copper, iron ore, platinum, diamonds, nickel, coal). Conglomerate shares often trade at a "conglomerate discount" – the group's market value is lower than the sum of its parts would be if listed separately.

The case for separating comes down to a few things:

• 🎯 Investors can pick and choose: Some investors may only want exposure to Anglo American’s copper business, or only to platinum. As a single group, that wasn't possible – investors had to take everything together. Demerging lets them buy into the specific business they want.

• 🧠 Management can focus: Running a single, focused business means the leadership team can give it their full attention, and capital gets directed where it earns the best return rather than spread across unrelated areas.

• 🔍 The business is easier to value: Two focused companies are easier for investors to understand and price than one diversified group.

The conglomerate discount can also make a company an attractive target for acquisition. In April 2024, that drew the attention of BHP – the world's largest mining company – which made an unsolicited takeover approach worth up to $49 billion for Anglo American.

BHP didn't want all of Anglo American – mainly just its copper business. It structured its bid to leave out the platinum and South African iron ore businesses. So, Anglo would have had to first spin some of these off to its shareholders, and BHP would take over what remained.

Anglo's board eventually declined the offer. Instead, the company went directly to its shareholders with an alternative plan:

• Step 1: Turn down BHP’s acquisition offer.

• Step 2: Restructure the company. Spin off or sell the platinum, diamond, nickel and steelmaking coal businesses, and refocus on copper, premium iron ore and crop nutrients.

• Step 3: Capture the benefits themselves. Ultimately own the same simpler, copper-focused company BHP wanted, but with Anglo's existing shareholders owning it.

This plan was put into action after BHP withdrew in May 2024, and the platinum demerger became one of the first major steps in delivering it.

Linklaters had advised Anglo on the takeover defence, and the same team moved straight onto the demerger. In this case, speed mattered – Anglo wanted the deal done as soon as possible after the successful defence.

What was actually being separated?

Valterra Platinum was not created from scratch.

It was already a separately listed South African company called AAP, trading on the Johannesburg Stock Exchange (JSE). So the mines, the company and its listing all already existed.

Anglo American owned most of these shares, so if you owned Anglo shares, part of their value was tied to its stake in AAP.

The demerger moved most of Anglo’s AAP stake into the hands of Anglo’s own shareholders, with the platinum business renamed Valterra Platinum. In other words, the “separation” was really a change in who holds the shares – Anglo largely dropped out as the middleman, keeping only a temporary stake of around 19.9%, and its shareholders ended up owning the rest directly.

That’s another point where Linklaters helped out. The firm had to advise on how to distribute those Valterra shares so shareholders owned them directly, rather than indirectly through Anglo.

How did Anglo American legally separate Valterra out?

Linklaters had two main routes to consider.

Option 1: ✂️ A reduction-in-capital demerger. A company's "capital" is the locked-in value built up in the company over time, including the money shareholders originally put in. A reduction-in-capital demerger involves formally cutting that capital by an amount equal to the value of the Valterra stake, then transferring that value to shareholders. Because reducing a company's capital affects the protection available to its creditors, the process requires court approval.

Option 2: 💸 A dividend demerger. A dividend is a payment a company makes to its shareholders, usually in cash, out of its profits. But a dividend can also be paid "in kind" – handing over an asset instead of cash. Here, Anglo would treat its Valterra shares as the dividend and distribute them to Anglo shareholders that way. This route only works if the parent has enough "distributable reserves" – the accumulated profits a company is legally allowed to hand back to shareholders.

Anglo American ultimately chose to go with Option 2, the dividend route. Anglo had sufficient distributable reserves, which meant it could distribute the Valterra shares as a dividend without needing the slower capital-reduction route that would have required court approval.

The result was that the demerger took effect on 31 May 2025 – almost a year to the day after BHP walked away.

How did Anglo American manage its share price through the demerger?

When a parent demerges a business, its own share price drops – because each remaining share now represents a smaller, narrower business.

For Anglo, the expected drop was around 12% – the share of its market value that the demerged stake represented.

To manage that drop, Anglo carried out a share consolidation alongside the demerger.

Usually, a company waits until after the demerger to see where its share price lands, then sets the consolidation ratio, but Anglo did it differently. Because Valterra was already listed in Johannesburg, it already had a real market price. That let Anglo set the ratio in advance, based on three months of trading prices for both companies.

Linklaters’ role was to ensure the share consolidation worked both legally and commercially. The financial advisers handled the numbers, but the lawyers had to set the legal boundaries: what Anglo could do, what approvals were needed, and whether the method could be implemented across the relevant markets.

Why did Anglo American simultaneously list Valterra in London?

Linklaters identified early on that Valterra would need a secondary listing in London – specifically on what was then the FCA's new international secondary listing category on the London Stock Exchange (LSE) – alongside its existing JSE listing. This would solve two practical problems for Anglo's shareholders.

• 🌐 Some investors couldn't hold JSE-only shares: Big investors often have rules about which exchanges they can hold securities on. Without a London listing, some of those investors would have been forced to sell their new Valterra shares immediately (known as “flowback”), which could push the price down.

• 🤝 UK shareholders would have faced trading friction: Most Anglo American shareholders held their shares through the UK register, and trading via Johannesburg would have meant unfamiliar settlement systems.

A London listing solved both problems. Valterra shares could be held and traded on the LSE, in a system Anglo shareholders already understood.

What did junior lawyers do on this deal?

On a deal this large, junior lawyers – including trainees at Linklaters – were able to get involved.

Here’s what they were doing.

• 📋 Keeping the deal on track: Trainees took ownership of the workstream trackers, steps plan and documents list – the running record of what needed to happen, what had been signed and what was still outstanding. On a transaction with this many stages, jurisdictions and advisers, that's an important role that stops tasks from slipping.

• ✍️ Drafting the corporate authorisations: Junior lawyers helped prepare the board and shareholder approvals (the corporate authorisations needed to legally carry out the demerger) and produced early drafts of some of the separation agreements. This meant they could get exposure to the commercial and legal issues of the deal.

• 🌍 Working across borders: Anglo’s shareholders were recorded in three countries – the UK, South Africa and Botswana – and the companies were listed on five stock exchanges. Trainees worked closely with Webber Wentzel (Anglo American's South African counsel and Linklaters' alliance partner) through weekly calls and day-to-day contact between teams.

What makes this deal stand out?

What makes this transaction stand out is the breadth of work it pulled together.

A single deal involved a corporate reorganisation, elements of private M&A, equity capital markets (the new London listing of Valterra), corporate advisory and the drafting of a shareholder circular.

It's rare for one transaction to demand that combination – and rarer still for junior lawyers to get exposure across several practice areas at once.

The transaction was named Deal of the Year at DealMakers South Africa's 2025 Annual Awards, and contributed to Linklaters' Corporate Team of the Year win at the Legal Business Awards 2025.

IN OTHER NEWS 🗞

• 🛒 Sainsbury's has agreed to sell Argos for at least £120 million. That's a fraction of the £1.4 billion it paid for the store in 2016. The buyer is Swift Partners, a new company backed by retail investor True Capital. The sale lets Sainsbury's pour everything into food. HSF Kramer advised Sainsbury's, with Jones Day acting for Swift.

• 💼 Ashurst Perkins Coie has become the largest UK law firm to operate as an alternative business structure. An ABS licence from the Solicitors Regulation Authority lets a firm take outside investment and have non-lawyer owners – something traditional law firm partnerships can't. But the firm says it isn't seeking external investment. Still, ABS licences are what let non-lawyers invest in firms like this one – we just covered a private equity-backed group that owns law firms.

• 🤖 Legora (the legal AI company) is buying litigation start-up Wexler – its fifth acquisition since March. Wexler's technology helps litigators find and verify facts in case files that can run to more than a million documents. Its clients include Clifford Chance, Goodwin and HSF Kramer. The 18-person Wexler team will join Legora's new engineering hub in London. Legora's main rival, Harvey, is buying too – it acquired the asset management platform Benchmark in July, its third acquisition this year.

OPEN TABS 🌐

• 🌿 Mindful: Watch a live stream of a lawn in the US that's been growing since 2005

• 🐠 Fishtris: Tetris but the blocks are schools of fish

• 📸 Bird's-eye: Here are the winners of Aerial Photographer of the Year – my favourite is this shot of red chillies drying in Bangladesh 👇️

  

  “Harvesting Red Chilies” by Azim Khan Ronnie, Bangladesh

STUFF THAT MIGHT HELP YOU 👌

• 💻️ Free application advice: Check out my YouTube channel for actionable tips and an insight into the lifestyle of a commercial lawyer in London.

• 📁 Law firm application bank: A growing library of real, verified successful applications for training contracts and vacation schemes. Helpful if you want to learn from others who answered the same questions you’re stuck on.

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