Blackhawk Mining Buys Arch Coal’s Hazard Subsidiary

Arch Coal Inc. (NYSE:ACI) announced that privately owned Blackhawk Mining LLC has purchased its Hazard subsidiary for $26.3 million in cash, “prior to post-closing adjustments.” Included in the sale are the Hazard thermal coal mining complex, related infrastructure and about 38 million tons of thermal coal reserves.

As quoted in the press release:

As part of the sale, Arch has divested $15.6 million of reclamation liabilities to Blackhawk, and expects to be released from $43.8 million of reclamation surety bonding. In addition, Arch has the potential to receive future royalty payments of up to $35.0 million in aggregate over the next five years resulting from its retention of select coal reserves at Hazard.

John W. Eaves, president and CEO of Arch, commented:

The sale of our Hazard subsidiary demonstrates that we are continuing to streamline our mining portfolio and monetize assets that are not essential to our future growth plans. This transaction allows us to further sharpen our focus on strategic assets that have the highest return potential, such as our growing Appalachian metallurgical coal franchise and our low-cost Western thermal coal platform. At the same time, the proceeds from the sale further strengthen our already substantial cash and liquidity position.

Click here to read the full Arch Coal Inc. (NYSE:ACI) press release.