British mining giant Anglo American has announced plans to break up the business after rejecting a £34bn bid from rival BHP.

The company said it will sell or demerge major parts of the firm, including its De Beers diamond operation, Anglo American Platinum and its steelmaking coal businesses.

The move will see the remaining company focus on its copper, iron ore and crop nutrients businesses.

The 107-year-old company has come under pressure to deliver value to investors as it fends off a takeover approach from Australia-based BHP.

“We expect that a radically simpler business will deliver sustainable incremental value creation through a step change in operational performance and cost reduction,” chief executive Duncan Wanblad said in a statement to the London Stock Exchange.

The shake-up is aimed to put the business in the best position to benefit from the global shift to clean energy, the company said.

Anglo American also said it expected the reshaping of the firm would lower its costs by $1.7bn (£1.35bn).

On Monday, Anglo American rejected an increased takeover offer from BHP, saying it was “highly unattractive” for its shareholders as it continued to significantly undervalue the firm.

BHP wants to buy Anglo American for its copper operations.

Copper is used to conduct electricity and demand is growing as some economies shift further to renewable energy and electric vehicles.

Anglo American owns two copper mines, in Chile and Peru, where BHP also has some operations.

The deal would have brought together two of the world’s biggest mining companies but could have faced significant competition hurdles if it went ahead.