• Connect with us
    • Information
      • About Us
      • Contact Us
      • Careers
      • Partnerships
      • Advertise With Us
      • Authors
      • Browse Topics
      • Events
      • Disclaimer
      • Privacy Policy
    • Australia
      North America
      World
    Login
    Investing News NetworkYour trusted source for investing success
    • North America
      Australia
      World
    • My INN
    Videos
    Companies
    Press Releases
    Private Placements
    SUBSCRIBE
    • Reports & Guides
      • Market Outlook Reports
      • Investing Guides
    • Button
    Resource
    • Precious Metals
    • Battery Metals
    • Base Metals
    • Energy
    • Critical Metals
    Tech
    Life Science
    Industrial Metals Market
    Industrial Metals News
    Industrial Metals Stocks
    • Industrial Metals Market
    • Industrial Metals News
    • Industrial Metals Stocks
    coal investing

    Peabody to Acquire Shoal Creek Mine Assets

    Georgia Williams
    Sep. 21, 2018 06:37AM PST
    Industrial Metals

    Shoal Creek is located on the Black Warrior River in Central Alabama and serves Asian and European steel mills with high-vol A coking coal.   

    Peabody (NYSE: BTU) announced today that it has signed a definitive agreement to purchase the Shoal Creek metallurgical coal mine from private coal producer the Drummond Company, for US$400 million.

    Shoal Creek is located on the Black Warrior River in Central Alabama and serves Asian and European steel mills with high-vol A coking coal.

    As quoted from the press release:

    The transaction involves the purchase of the mine, preparation plant and supporting assets, and excludes legacy liabilities other than reclamation. The purchase price is subject to customary working capital adjustments. Closing is expected prior to the end of 2018 and is subject to regulatory approvals, certain conditions precedent, including negotiation by Drummond of a collective bargaining agreement with the union-represented workforce, and other customary conditions.

    “Peabody has consistently outlined our intention to upgrade our metallurgical coal platform and make strategic investments using a strict set of filters. We believe the purchase of the well-capitalized and high-quality Shoal Creek Mine meets these filters, offers major logistical advantages and represents an opportunity to create significant value,” said Peabody president and chief executive officer Glenn Kellow. “The acquisition allows us to expand volumes and margins from our met coal platform, enhances our scale, and offers complementary products to customers. We applaud the Drummond team for developing a high-quality operation, and we look forward to advancing that reputation for excellence.”

    Peabody believes the acquisition is consistent with the company’s previously stated investment filters: maintain financial strength; fit within the company’s strategic focus areas of the PRB, ILB, seaborne met and seaborne thermal; provide expected returns above Peabody’s weighted average cost of capital with a reasonable payback period; bring about tangible synergies; and create value for the company’s shareholders.

    The acquisition represents a number of strategic and financial benefits for Peabody:

    • Upgrading Peabody’s Metallurgical Coal Platform: Shoal Creek represents the next phase of Peabody’s initiative to upgrade its metallurgical coal platform. The mine adds approximately 2 million tons per year of high quality hard coking coal sales that are expected to expand Peabody’s met coal volumes and margins, with costs comparable to Peabody’s average met coal range.
    • Quality Assets Serving Growing Demand Centers: Shoal Creek is strategically positioned on the Black Warrior River with direct access to barge transportation, eliminating trucking or rail requirements. The mine accesses seaborne markets through the Port of Mobile in the Gulf of Mexico serving Asia-Pacific and European steel mills.

    Click here to read the full announcement

    coal investing
    The Conversation (0)

    Go Deeper

    AI Powered
    Torn contract paper with a pen on a table.

    Peabody Scraps Plans to Acquire Anglo's Steelmaking Coal Portfolio

    Bag of money and pieces of coal.

    Anglo American to Sell Steelmaking Coal Portfolio to Peabody for US$3.78 Billion

    Latest News

    Operational Update

    More News

    Outlook Reports

    Resource
    • Precious Metals
      • Gold
      • Silver
    • Battery Metals
      • Lithium
      • Cobalt
      • Graphite
    • Energy
      • Uranium
      • Oil and Gas
    • Base Metals
      • Copper
      • Nickel
      • Zinc
    • Critical Metals
      • Rare Earths
    • Industrial Metals
    • Agriculture
    Tech
      • Artificial Intelligence
      • Cybersecurity
      • Gaming
      • Cleantech
      • Emerging Tech
    Life Science
      • Biotech
      • Cannabis
      • Psychedelics
      • Pharmaceuticals

    Featured Industrial Metals Stocks

    Norzan Enterprises Ltd.

    NRZ.H:CA

    Buffalo Coal Corp.

    BUF:CA

    Morien Resources Corp.

    MOX:CA

    SouthGobi Resources Ltd.

    SGQ:CA

    Corsa Coal Corp.

    CSO:CA

    Colonial Coal International Corp.

    CAD:CA
    More featured stocks

    Browse Companies

    Resource
    • Precious Metals
    • Battery Metals
    • Energy
    • Base Metals
    • Critical Metals
    Tech
    Life Science
    MARKETS
    COMMODITIES
    CURRENCIES
    ×