Corsa Coal Corp. (TSXV:CSO) has entered into an agreement with Lybica Holding B.V., a 100 percent owned subsidiary of OAO Severstal (LSE:SVST), among others, in order to acquire all of the issued and outstanding shares of Lybica’s wholly-owned subsidiary, PBS Coals Limited through an all-cash transaction for consideration of US$60 million, subject to customary adjustments for working capital and debt.
As quoted in the press release:
PBS, based in Somerset County, Pennsylvania, commenced production in 1963 and was acquired by OAO Severstal in 2008. Its current operations include 13 developed mines (3 active) and two preparation plants with access to both the CSX and Norfolk Southern Railway. Collectively, these mines sold approximately 2.5 million and 1.7 million tons of premium quality low-volatile met coal in 2012 and 2013, respectively. PBS is located 60 miles from Pittsburgh and 170 miles from the Baltimore port, and its coal brands are well recognized by long-standing domestic and international customers. Its existing assets and infrastructure enable PBS to scale up to 3.5 million tons of saleable metallurgical production per year if market conditions warrant.
Corsa president, Keith Dyke, said:
The proximity of PBS’ assets and infrastructure to Corsa’s existing Pennsylvania operations creates considerable synergy and marketing opportunities. Adding the PBS metallurgical coal properties improves Corsa’s ability to grow production, lower costs, and better serve our customers domestically and internationally