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April 29, 2014
07:20 EDTWLBWestmoreland finalizes Sherritt coal operations acquisition, repays WML notes
Westmoreland Coal has completed the acquisition of Sherritt International's Prairie and Mountain coal mining operations, which include seven producing thermal coal mines in the Canadian provinces of Alberta and Saskatchewan, a 50% interest in an activated carbon plant and a Char production facility. Together with Westmoreland's existing U.S. operations, the acquisition places the firm as North America’s sixth largest coal producer. Concurrent with the closing of the acquisition, the proceeds from the previously announced private offering of $425M in aggregate principal amount of 10.75% Senior Secured Notes were released from escrow. The escrowed funds were to be released upon satisfaction of all conditions precedent to the acquisition, receipt of regulatory approvals and certain other conditions, all of which were satisfied. Such notes were initially issued by Westmoreland Escrow, a subsidiary of Westmoreland, and as a result of the closing of the acquisition, are being automatically exchanged for identical notes issued by Westmoreland and Westmoreland Partners, as co-issuers. The notes were offered only to qualified institutional buyers under Rule 144A of the Securities Act of 1933, as amended and to buyers outside the U.S. pursuant to Regulation S under the Securities Act. The notes have not been registered under the Securities Act, and until so registered, the notes may not be offered or sold in the United States except pursuant to an exemption from the registration requirements of the Securities Act and applicable state securities laws. As previously announced as part of the Senior Secured Notes offering, Westmoreland Mining, a wholly owned subsidiary of Westmoreland, announced that it has provided prepayment notices to holders of its 8.02% senior secured notes due 2018. Such debt will be prepaid by the end of May and all collateral secured under such debt will become collateral under Westmoreland’s 10.75% Senior Secured Notes. Westmoreland will also terminate WML’s existing $25M credit facility prior to prepaying the WML notes.
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July 16, 2014
12:07 EDTWLBLonestar Partners reports 5.4% passive stake in Westmoreland Coal
July 11, 2014
06:05 EDTWLBWestmoreland Coal 1.46M share Secondary priced at $35.50
BMO Capital and Deutsche Bank acted as joint book running managers for the offering.
July 8, 2014
11:38 EDTWLBCoal producers retreat after Morgan Stanley lowers price forecast
Shares of some coal producers are falling after Morgan Stanley reduced its price targets on several names in the sector. WHAT'S NEW: Morgan Stanley analyst Evan Kurtz warned that metallurgical coal prices may rebound more slowly than the firm had previously expected. The firm's commodity forecasters reduced their outlook for met coal prices to $133 from $160 per ton in 2015, Kurtz reported. Chinese imports have been weak so far this year, as exports to that country from Australia have risen, the analyst explained. However, production cuts should still help prices rise next year, Kurtz stated. Nonetheless, he cut his price target on Walter Energy (WLT) to $16 from $26, on Alpha Natural (ANR) to $4 from $5 and on Arch Coal (ACI) to $2 from $3. He kept an Overweight rating on Walter Energy, an Equal Weight rating on Alpha Natural and an Underweight rating on Arch Coal. COMPANY NEWS: In addition to the analyst opinion, two of the companies in the sector, Walter Energy and Westmoreland Coal (WLB), announced news this morning. Walter Energy announced that it has commenced a private offering of $320M aggregate principal amount of 9.5% senior secured notes due 2019. Walter also disclosed in a regulatory filing earlier that its preliminary metallurgical coal production for Q2, including both hard coking coal and low-volatility pulverized coal injection product, was 2.5M metric tons, and that its preliminary metallurgical coal sales for Q2 was 2.7M metric tons. Additionally, Walter noted that it incurred severance charges of approximately $7M in Q2 in connection with the idling of its mines in Canada. For its part, Westmoreland disclosed in a regulatory filing that the company currently anticipates reporting adjusted EBITDA in the range of $35M-$38M for the three months ended June 30. WHAT'S NOTABLE: On June 20, another research firm, Sterne Agee, recommended that risk-tolerant investors buy Alpha Natural. The firm predicted that the company would benefit from normalizing thermal and metallurgical coal prices. According to Sterne Agee, the market was underestimating several of Alpha Natural's positive catalysts. PRICE ACTION: In late morning trading, Walter Energy sank 5.4% to $5.82, Alpha Natural gave back 7.2% to $3.37, Arch Coal retreated 5.2% to $3.22, and Westmoreland sank 5% to $34.97.
11:07 EDTWLBWestmoreland Coal sees Q2 adjusted EBITDA $35M-$38M
In a regulatory filing, the company said, "Although our unaudited consolidated financial statements for the three months ended June 30, 2014 are not yet complete, we currently anticipate reporting Adjusted EBITDA in the range of $35.0-$38.0 million for the three months ended June 30, 2014. This represents an approximate 21%-31% increase from our Adjusted EBITDA of $28.9 million for the three months ended March 31, 2014. We have not completed the application of purchase accounting following closing of the Canadian Acquisition and are therefore unable to provide a range of net income (loss) for the three months ended June 30, 2014."
11:05 EDTWLBHigh option volume stocks:
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09:02 EDTWLBWestmoreland Coal files to sell $52M in common stock
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