Bowie to Buy Arch Coal’s Canyon Fuel for $435 Million

Mining Connection reported that Arch Coal Inc. (NYSE:ACI) and Bowie Resources LLC have entered into a definitive agreement that will see Bowie buy Canyon Fuel Company LLC, a subsidiary of Arch, for $435 million.

As quoted in the market news:

Canyon Fuel includes the Sufco and Skyline longwall mines and the Dugout Canyon continuous miner operation, all located in Utah. In addition to these active operations and related support facilities, Bowie will receive approximately 105 million tons of bituminous coal reserves in Utah. After the transaction is completed, Bowie plans to keep the existing 725-person workforce in place at the Canyon Fuel operations.

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

The sale of our Utah operations is consistent with our previously announced plan to unlock value for our shareholders by divesting certain non-core thermal coal assets. As part of our strategy, we have been diligently focused on optimizing our asset base, expanding our coal export network, reducing our discretionary capital spending, and re-aligning our portfolio for growth. With this transaction, we’re delivering on a number of these initiatives while also enhancing our financial flexibility.

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