WEST VIRGINIA (LOOTPRESS) – In a move to consolidate their strengths and expand their global reach, Arch Resources, Inc. and CONSOL Energy Inc. have announced a definitive agreement to merge in an all-stock transaction.
This merger will create Core Natural Resources, a leading North American natural resource company with a focus on global markets.
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The combined company will be a significant player in the coal industry, boasting 11 mining operations across six states and ownership interests in two export terminals on the U.S. Eastern seaboard.
Core Natural Resources will offer a diverse portfolio of high-quality metallurgical and thermal coals, targeting both domestic and international markets.
With this merger, the new entity will own some of the largest and lowest-cost coal mining complexes in North America.
Jimmy Brock, Chairman and CEO of CONSOL, emphasized the merger’s potential to create a stronger, more diversified company.
“We are excited to bring our companies together to create a new industry leader that is ideally positioned to meet the rising demand for critical resources and energy around the world,” Brock stated.
He highlighted the merger’s expected benefits, including a strong balance sheet, ample liquidity, and robust free cash flow, which are anticipated to deliver substantial returns to stockholders.
Paul Lang, CEO of Arch, echoed Brock’s optimism, noting the complementary nature of the two companies’ assets.
“This merger will join two proven leadership teams and best-in-sector operating platforms to establish a premier North American coal producer with worldwide reach and world-class mining and logistics capabilities,” Lang said.
Core Natural Resources is projected to have a market capitalization of approximately $5.2 billion, with pro forma revenues of around $5.7 billion and adjusted EBITDA of approximately $1.8 billion based on 2023 figures.
The company is expected to generate $110 million to $140 million in annual cost savings and operational synergies within the first 18 months of the merger.
The merger is expected to close by the end of the first quarter of 2025, pending approval from both companies’ stockholders and regulatory authorities.
Upon completion, Core Natural Resources will be headquartered in Canonsburg, Pennsylvania, with a continued presence in St. Louis.
Under the terms of the merger, Arch stockholders will receive 1.326 shares of CONSOL common stock for each share of Arch common stock owned, resulting in Arch stockholders owning approximately 45% of the new company, and CONSOL stockholders owning approximately 55%.
Both companies will suspend share repurchases until the transaction is finalized.
However, they will continue to pay quarterly dividends of up to $0.25 per share, subject to board approval.
