Toronto-based Corsa Coal has agreed to buy PBS Coals from Severstal for US$ 60 million, six years after the Russian steelmaker acquired it for about US$ 1 billion. Corsa Coal will also take on US$ 60 million of water treatment and reclamation liabilities and fund US$ 20 million currently held by PBS Coals as collatoral for other liabilities.
“This acquisition is a perfect match for Corsa’s strategic vision of building a low-cost, premium-quality metallurgical coal producer,” said Corbin Robinson, chairman of Corsa Coal. “Corsa is now positioned with the asset base and financial flexibility required to capitalise on the company’s ambitious growth plans.”
Pennsylvania-based PBS Coals current operations include 13 developed mines, three of which are active, as well as two preparation plants with access to both the CSX and Norfolk Southern Railway. Collectively, these mines sold about 2.5 million short t of metallurgical coal in 2012 and 1.7 million short t in 2013.
According to Corsa Coal, PBS Coals’ existing assets and infrastructure enable the company to scale up production to 3.5 million short tpa of metallurgical coal when market conditions improve.
“The proximity of PBS’ assets and infrastructure to Corsa’s existing Pennsylvania operations creates considerable synergy and marketing opportunities,” concluded Keith Dyke, president of Corsa. “Adding the PBS metallurgical coal properties improves Corsa’s ability to grow production, lower costs, and better serve our customers domestically and internationally”.
Written by Jonathan Rowland
Read the article online at: https://www.worldcoal.com/mining/16072014/world-coal_corsa_coal_buys_pennsylvania_coal_assets_from_severstal_coal1091/