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Wednesday, 13 May 09
ALPHA TO BUY RIVAL, CREATING NEW US COAL HEAVYWEIGHT - MININGWEEKLY.COM
 Alpha Natural Resources, the biggest supplier of metallurgical coal in the US, has agreed to buy Maryland-based rival Foundation Coal for about $1,4-billion in shares, creating what will be the nation's third-biggest coal miner.
The merged company will be better able to weather the short term challenges facing coal producers, as well as to take advantage of an anticipated rebound in demand and prices for coal, said Alpha CEO Michael Quillen.
He has been looking for opportunities to grow by merger or acquisition since bulk-commodities miner Cleveland Cliffs (now Cliffs Natural Resources) broke off plans in November to buy Alpha, because of market uncertainty and opposition from a key Cliffs shareholder.
“This is really the sort of transformational event that Alpha's been talking about for some time now, and we believe that this is also the right time to do it,” Quillen said on Tuesday.
Besides assets in Central and Northern Appalachia, Foundation produces coal from surface mines in the Powder River Basin, in Wyoming, which are not only less expensive to operate, but are also not facing the same regulatory challenges as the Appalachian region, where Alpha has all its assets.
While surface mines in the Eastern US are coming under increased environmental scrutiny and regulatory challenges, operations in Wyoming do not face the same degree of opposition.
The Foundation acquisition “does actually spread out the risk,” Quillen said.
Foundation also produces mainly thermal coal, for power generation, which help diversify Alpha's metallurgical-coal-heavy production mix.
The combined company, which will be 59% owned by current Alpha shareholders and 41% by Foundation, will operate 59 coal mines and 14 preparation plants, and will own more than 2,3-billion tons of coal reserves.
"We're creating a true US leader in the energy sector with balance, size and scale,” Quillen said.
The firms also expect to achieve at least $45-million a year in savings, as a result of synergies, beginning in 2010.
US coal producers, including the two largest – Peabody Energy and Arch Coal – have reduced production levels and sales forecasts for this year, after sales volumes fell sharply because of weak demand for both steel and electricity.
Alpha and Foundation have both also curtailed operations, and Foundation CEO James Roberts indicated last week that the company was expecting some utilities to defer contracted shipments this year.
However, speaking on a conference call on Tuesday, he said that demand for steel and electricity are expected to rebound in 2010 and beyond.
“And when the economy recovers, supply [of coal] will struggle to keep up with demand, so prices will recover,” Roberts said.
Foundation shares leapt 20,74% on Tuesday, to $28,06 apiece by 16:01 in New York. The stock traded as high as $31,54 earlier in the day.
Alpha stock slid 6,24%, to $27,06 a share.
Analysts generally welcomed the deal, with
STRUCTURED TO GROW
Once the Foundation transaction has closed, which is expected to be in the second half of the year, and the businesses are properly integrated, Alpha is keen to take advantage of further acquisition opportunities, Quillen said.
“The way we've structured this balance sheet is to continue to grow, and to take advantage of opportunities – whether they are distressed or whether they are just in different geographic basins,” he said.
“We are still going to be around in the M&A environment going forward.”
After the tie-up, the new company will have about $750 million in cash, cash equivalents and undrawn credit.
Under the terms of a definitive merger agreement, Foundation shareholders will receive 1,084 shares of the new company for each Foundation share held, while Alpha shares will automatically become shares of the combined company.
Alpha Natural will issue about 50-million new shares, and will assume $530-million of Foundation's net debt, for a total transaction value of around $2-billion.
The deal values Foundation stock at $32,73 a share, which was a 37% premium to the company's average closing share price over five days prior to the deal being signed.
The deal requires approval from shareholders representing a majority of the outstanding shares in each company.
Quillen said he was confident of shareholder support for the deal, and did not expect to encounter the sort of difficulties that scuppered the Cliffs transaction.
The new company will retain the Alpha name and will be headquartered in Abingdon, Virginia.
Quillen will be appointed chairperson and Alpha president Kevin Crutchfield will be CEO, while Kurt Kost, Foundation's president and COO, will become president of the combined company.
Source: http://www.miningweekly.com/article/alpha-natural-will-buy-foundation-for-2bn-creating-new-us-coal-giant-2009-05-12
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Friday, 08 May 09
INDONESIAN STATE AUDIT BOARD COULD ONLY REACHED A SMALL NUMBER OF KP AND PKP2B - MAJALAHTAMBANG
THE LACK of personnel and the very limited time period have been the reasons why the 2nd semester of the special purpose audit for coal mining ...
Friday, 08 May 09
B.C.'S MINING INDUSTRY HIGH COAL PRICES TO RECORD 2008 PROFITS - PAGUNTAKA
AGGREGATE pre-tax earnings rose to $3.2 billion, the highest amount in the 41-year history of a PricewaterhouseCoppers survey.
B.C.’s minin ...
Thursday, 07 May 09
ASIA COAL-PRICES EASE TO NEAR $63 ON DEMAND CONCERNS - REUTERS
AUSTRALIAN thermal coal prices, a benchmark for Asia, edged lower to around $63 a tonne on concerns over demand, after hitting a two-week high of $6 ...
Thursday, 07 May 09
RICHARDS BAY COAL SHIPMENTS FALL MOST IN 9 MONTHS - BLOOMBERG
RICHARDS BAY Coal Terminal Ltd., Africa’s largest coal-export facility, said shipments fell 24 percent last month, the biggest drop in nine mo ...
Tuesday, 05 May 09
NEWCASTLE PORT'S WEEKLY COAL EXPORTS INCREASE - BLOOMBERG
COAL shipments from Australia’s Newcastle port, the world’s biggest export harbor for the fuel, rose 18 percent last week while the numb ...
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- CIMB Investment Bank - Malaysia
- Bahari Cakrawala Sebuku - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Parry Sugars Refinery, India
- White Energy Company Limited
- Rio Tinto Coal - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Dalmia Cement Bharat India
- Directorate General of MIneral and Coal - Indonesia
- Wilmar Investment Holdings
- Mercuria Energy - Indonesia
- Globalindo Alam Lestari - Indonesia
- Ministry of Mines - Canada
- Chamber of Mines of South Africa
- Bukit Baiduri Energy - Indonesia
- Indogreen Group - Indonesia
- Videocon Industries ltd - India
- Bharathi Cement Corporation - India
- Therma Luzon, Inc, Philippines
- Goldman Sachs - Singapore
- Petron Corporation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Semirara Mining Corp, Philippines
- Energy Development Corp, Philippines
- Indo Tambangraya Megah - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Binh Thuan Hamico - Vietnam
- Agrawal Coal Company - India
- Billiton Holdings Pty Ltd - Australia
- The State Trading Corporation of India Ltd
- Pendopo Energi Batubara - Indonesia
- Economic Council, Georgia
- Essar Steel Hazira Ltd - India
- Carbofer General Trading SA - India
- Australian Coal Association
- Orica Mining Services - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Ministry of Finance - Indonesia
- OPG Power Generation Pvt Ltd - India
- GVK Power & Infra Limited - India
- Holcim Trading Pte Ltd - Singapore
- AsiaOL BioFuels Corp., Philippines
- Kobexindo Tractors - Indoneisa
- Semirara Mining and Power Corporation, Philippines
- Simpson Spence & Young - Indonesia
- Sarangani Energy Corporation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Altura Mining Limited, Indonesia
- Price Waterhouse Coopers - Russia
- Mercator Lines Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Thai Mozambique Logistica
- Central Java Power - Indonesia
- Coastal Gujarat Power Limited - India
- CNBM International Corporation - China
- Antam Resourcindo - Indonesia
- Coal and Oil Company - UAE
- San Jose City I Power Corp, Philippines
- Rashtriya Ispat Nigam Limited - India
- Siam City Cement PLC, Thailand
- Karbindo Abesyapradhi - Indoneisa
- Samtan Co., Ltd - South Korea
- Energy Link Ltd, New Zealand
- Bulk Trading Sa - Switzerland
- Orica Australia Pty. Ltd.
- Riau Bara Harum - Indonesia
- Intertek Mineral Services - Indonesia
- Global Business Power Corporation, Philippines
- Singapore Mercantile Exchange
- Vijayanagar Sugar Pvt Ltd - India
- Jindal Steel & Power Ltd - India
- Maheswari Brothers Coal Limited - India
- Madhucon Powers Ltd - India
- Banpu Public Company Limited - Thailand
- Bukit Asam (Persero) Tbk - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Kaltim Prima Coal - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Baramulti Group, Indonesia
- IEA Clean Coal Centre - UK
- ASAPP Information Group - India
- Aditya Birla Group - India
- Indian Energy Exchange, India
- Sindya Power Generating Company Private Ltd
- Aboitiz Power Corporation - Philippines
- Larsen & Toubro Limited - India
- Kartika Selabumi Mining - Indonesia
- Interocean Group of Companies - India
- Grasim Industreis Ltd - India
- Trasteel International SA, Italy
- The Treasury - Australian Government
- Marubeni Corporation - India
- Kepco SPC Power Corporation, Philippines
- Jaiprakash Power Ventures ltd
- VISA Power Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bangladesh Power Developement Board
- Formosa Plastics Group - Taiwan
- Leighton Contractors Pty Ltd - Australia
- Romanian Commodities Exchange
- Deloitte Consulting - India
- Meenaskhi Energy Private Limited - India
- Mintek Dendrill Indonesia
- Straits Asia Resources Limited - Singapore
- New Zealand Coal & Carbon
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- Ind-Barath Power Infra Limited - India
- Bukit Makmur.PT - Indonesia
- Sakthi Sugars Limited - India
- Chettinad Cement Corporation Ltd - India
- Makarim & Taira - Indonesia
- Sree Jayajothi Cements Limited - India
- Merrill Lynch Commodities Europe
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- Australian Commodity Traders Exchange
- Parliament of New Zealand
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- Minerals Council of Australia
- Gujarat Sidhee Cement - India
- Petrochimia International Co. Ltd.- Taiwan
- IHS Mccloskey Coal Group - USA
- Tamil Nadu electricity Board
- Siam City Cement - Thailand
- Alfred C Toepfer International GmbH - Germany
- Electricity Generating Authority of Thailand
- Miang Besar Coal Terminal - Indonesia
- Malabar Cements Ltd - India
- Star Paper Mills Limited - India
- Wood Mackenzie - Singapore
- Ambuja Cements Ltd - India
- Vedanta Resources Plc - India
- TeaM Sual Corporation - Philippines
- Africa Commodities Group - South Africa
- Pipit Mutiara Jaya. PT, Indonesia
- South Luzon Thermal Energy Corporation
- SMG Consultants - Indonesia
- Kumho Petrochemical, South Korea
- Thiess Contractors Indonesia
- Planning Commission, India
- Krishnapatnam Port Company Ltd. - India
- Power Finance Corporation Ltd., India
- Lanco Infratech Ltd - India
- Medco Energi Mining Internasional
- Commonwealth Bank - Australia
- Kideco Jaya Agung - Indonesia
- Directorate Of Revenue Intelligence - India
- Ministry of Transport, Egypt
- Indonesian Coal Mining Association
- Bhushan Steel Limited - India
- Posco Energy - South Korea
- Sojitz Corporation - Japan
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Global Coal Blending Company Limited - Australia
- Port Waratah Coal Services - Australia
- Bhoruka Overseas - Indonesia
- Eastern Energy - Thailand
- SMC Global Power, Philippines
- Global Green Power PLC Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Central Electricity Authority - India
- Bayan Resources Tbk. - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Barasentosa Lestari - Indonesia
- Anglo American - United Kingdom
- Indika Energy - Indonesia
- MS Steel International - UAE
- Mjunction Services Limited - India
- Electricity Authority, New Zealand
- Heidelberg Cement - Germany
- Sical Logistics Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Renaissance Capital - South Africa
- Jorong Barutama Greston.PT - Indonesia
- Salva Resources Pvt Ltd - India
- PNOC Exploration Corporation - Philippines
- India Bulls Power Limited - India
- Meralco Power Generation, Philippines
- Manunggal Multi Energi - Indonesia
- The University of Queensland
- Cement Manufacturers Association - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Tata Chemicals Ltd - India
- GAC Shipping (India) Pvt Ltd
- Georgia Ports Authority, United States
- Independent Power Producers Association of India
- Coalindo Energy - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Savvy Resources Ltd - HongKong
- Oldendorff Carriers - Singapore
- International Coal Ventures Pvt Ltd - India
- European Bulk Services B.V. - Netherlands
- McConnell Dowell - Australia
- GMR Energy Limited - India
- Xindia Steels Limited - India
- PowerSource Philippines DevCo
- Eastern Coal Council - USA
- PTC India Limited - India
- Latin American Coal - Colombia
- ICICI Bank Limited - India
- Attock Cement Pakistan Limited
- LBH Netherlands Bv - Netherlands
- Ceylon Electricity Board - Sri Lanka
- Indian Oil Corporation Limited
- Iligan Light & Power Inc, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Edison Trading Spa - Italy
- Toyota Tsusho Corporation, Japan
- Metalloyd Limited - United Kingdom
- Vizag Seaport Private Limited - India
- SN Aboitiz Power Inc, Philippines
- Karaikal Port Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Timah Investasi Mineral - Indoneisa
- Bhatia International Limited - India
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