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Key Takeaways
- Arch Resources and Consol Energy will merge in 2025 to create Core Natural Resources.
- The combined coal producer will operate 11 mines and have access to a global distribution network.
- Core Natural Resources would have a market cap of about $5.2 billion if realized today.
Arch Resources (ARCH) and Consol Energy (CEIX) are merging in an all-stock deal, the two coal miners said Wednesday.
The companies, who have a combined market cap of about $5.2 billion, said the all-stock merger of equals will create a coal producer called Core Natural Resources that will have 11 mines and about 25 million tonnes per annum (Mtpa) of export capacity.
Core Natural Resources will also have stakes in a pair of East Coast terminals and strategic access to ports on the West Coast and the Gulf of Mexico.
Deal Seen Bringing Up To $140M in Annual Synergies
The deal, which is expected to close in early 2025, is seen generating between $110 million and $140 million in annual cost and operational synergies, the firms said.
“Our assets are highly complementary, resulting in increased diversification across coal types, end uses, and geographies,” Consol Chief Executive Officer (CEO) Jimmy Brock said.
Shares of Consol gained 3.8% to $98.35 as of 12:45 p.m. ET Wednesday, while those of Arch rose 1.8% to $129.06. They are down more than 2% and 22% year-to-date, respectively.