South32 $10b deal; house prices drop for 3rd month; Trump’s $US1b crypto bonanza
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What is the main topic discussed in this episode?
Welcome to Fear and Greed, business news you can use today.
What is the significance of South32's $10 billion deal?
Diversified miner South32 sells its aluminium and alumina business for $10 billion as it focuses on copper. House prices across the nation fall for the third month in a row.
How have house prices changed across Australia recently?
And US President Donald Trump makes more than $1 billion from business dealings in cryptocurrency. Plus, Prime Minister Anthony Albanese says it's appropriate that the people who accessed his bank accounts are charged and coals under fire from the ACCC over a Kalgoorlie supermarket.
What are the implications of Prime Minister Albanese's banking privacy statement?
It is Thursday, the 2nd of July, 2026. I'm Michael Thompson, and good morning, Sean Aylmer. Good morning, Michael. Sean, the main story this morning, diversified miner South32 will sell the bulk of its aluminium and alumina assets to Alcoa for nearly $10 billion. The announcement surprised investors, really, particularly because the division accounts for almost 40% of South32's earnings. The company, which has spun out of BHP a little over a decade ago, wants to focus on copper, which is the boom commodity at the heart of the AI and really all kind of future technology needs a lot of copper, obviously. The US-based Alcoa, which has a large local arm there and then a secondary listing on the ASX, will pick up assets across Australia, Brazil and South Africa.
Michael, this is a complex bid. I was worried you were going to say that, but I was reading it like it does not feel straightforward. Take us through it.
I read all sorts of reports on this to try and work this one out. Special thanks to Sean and Clee Column in the Fin Review for helping me. Cash up front as well as script. Fair enough. South32 will distribute some of that script to shareholders, sell some others. Then there's something called a vendor finance element.
How did Trump earn over $1 billion from cryptocurrency?
So Alcoa gets the cash flow generated from the aluminium business from April 1, then uses that cash to pay for the deal. There's also a ticking fee. a break fee, a reverse break fee. That's if things go wrong. And South32 has the potential to get extra payments if the price of alumini and or aluminium goes up. Just to cap it off, it was done by CEO Graeme Kerr, who officially finished at South32 on Tuesday.
What are the challenges facing the Australian housing market?
This, Michael, is a crazy complex deal.
Yeah. Okay. It might be crazy and it certainly is complex, Sean. But is it a good deal, I suppose, is the big question for South32 and for South32 shareholders. Because yesterday its share price jumped 10%. Alcoa was down 7%. So the early indications are that investors in South32 are happy. Yeah. Yes.
I mean, it's so complex, it is harder than usual to get a reading on how good a deal it is. All deals, basically, you can't tell whether it's a good or bad deal for a number of years anyway.
Why is Coles under scrutiny from the ACCC?
But this is particularly difficult. What it does do is transform South32. It's the country's sixth largest miner, behind the big three iron ore miners and gold diggers Northern Star and Evolution. Including yesterday's surge, it's up 44% over the past year. Now, under Kerr, it sold its coal assets. It sold its Colombian nickel business. It's shifted more towards mining what you might call tomorrow's commodities, particularly copper. Copper, going forward, will be 55% of its earnings, and yesterday the company approved a new grinding line at one of its mines in Chile. Smile off the face, Michael. That'll boost copper production by about 30%. What a grinding line does is basically take the raw extract and grinds it into a fine powder.
That's a lot more boring than I was hoping for, but go on.
South32 has also got a stack of money from this deal. I mean, assuming it completes, more than $5 billion. It's got projects in Arizona and Alaska in the US that need capital. It is a transformative deal for the business, no doubt about it. So it is a big one.
I am very glad that you were the one that put your hand up to sort through all of that and explain that because that is one complex arrangement. And I love the fact that the person who did the deal is now actually finished up at South 32. So it was like, God, I hope he left some handover notes.
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Chapters
8 chapters
1
What is the main topic discussed in this episode?
0:06–0:09
2
What is the significance of South32's $10 billion deal?
0:09–0:21
3
How have house prices changed across Australia recently?
0:21–0:38
4
What are the implications of Prime Minister Albanese's banking privacy statement?
0:38–1:59
5
How did Trump earn over $1 billion from cryptocurrency?
1:59–2:27
6
What are the challenges facing the Australian housing market?
2:27–3:05
7
Why is Coles under scrutiny from the ACCC?
3:05–6:49
8
What financial insights were shared by Jonathan Armitage?
6:49–15:13
Speakers
2 identifiedMore from FEAR & GREED | Business News
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