TECO Energy Inc. has closed the sale of its coal mining subsidiary, TECO Coal LLC, to Cambrian Coal Corp. There were no up-front purchase payments for the sales agreement, however the agreement does include future contingent consideration of US$60 million if certain coal benchmark prices meet particular levels over the next five years.
In 3Q14, TECO Coal was classified as an asset held for sale and its operating results have been reported as discontinued operations since then.
TECO Energy maintains certain personnel related liabilities, but all other TECO Coal liabilities have been passed over in the transaction. The retained liabilities included pension liability and severance agreements.
TECO Energy CEO, John Ramil, said: “The closing of this sale results in a complete exit from the coal mining business. TECO Coal was an important component of TECO Energy’s business mix since the mid-1970s, contributing strong earnings and cash flow for many years. We appreciate the dedicated team members at TECO Coal and the contributions they have made to TECO Energy’s success.”
J.P. Morgan Securities LLC were the financial advisor for TECO and Skadden, Arps, Slate, Meagher & Flom, LLP were its legal advisor.
Edited from press release by Harleigh Hobbs
Read the article online at: https://www.worldcoal.com/coal/22092015/teco-coal-sale-complete-2885/