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News Breaks | | | | August 31, 2012 | | 08:02 EDT |  | NC | Nacco Industries unit acquires Reed companies
The North American Coal Corporation, a wholly owned subsidiary of NACCO Industries, announced that it acquired, through a wholly owned subsidiary, four related companies - Reed Minerals, Inc., Reed Hauling Inc., C&H Mining Company, Inc. and Reed Management, L.L.C. - from members of and entities controlled by the Reed family. These companies, which will be known as Reed Minerals, are based in Jasper, Alabama and are involved in the mining of bituminous coal. The acquired operations mine and market steam coal and mid-to-high volatile metallurgical coal for sale primarily into the power generation and steel markets. The acquisition, which was funded using borrowings under North American Coal's existing credit facility, was completed for a preliminary purchase price of approximately $62.5M, less certain amounts specified in the purchase agreement to complete the transaction on a "cash-free, debt-free" basis. The terms of the transaction also include an earn-out contingent on the average coal selling price received on the first 15M tons of coal sold by North American Coal from the Reed Minerals operations. The earn-out payments will be paid quarterly and, if payable, will commence in the third quarter of 2012. North American Coal expects the acquisition to be accretive to earnings immediately. | |
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