CanAm Coal said April 19 that it will combine its pre-existing Alabama coal mining operations under one common structure and team that will be led by Birmingham Coal & Coke, an Alabama producer it bought a 50% stake in last year.
Since November 2009, CanAm (TSX VENTURE: COE) (OTCQX: COECF) has successfully completed two acquisitions: gaining control of RAC Mining LLC, a predominantly metallurgical coal producer in Alabama; and acquiring a 50% ownership stake in Birmingham Coal & Coke (BCC), a predominantly thermal coal producer, with a five-year option to purchase the remaining 50%. Up until recently, these respective operating subsidiaries and their mines were managed independently.
Under this new combined structure BCC will, in addition to the operation of the Bear Creek, Old Union and Gooden Creek mines, also take on operational responsibility for the Powhatan and Davis mine. This consolidation will allow CanAm to simplify the management structure, implement consistent policies, processes and procedures across all mines and establish a common performance measurement and accountability framework.
Wayne Bass, Vice President of Operations for BCC, and Eddie Colburn, General Mine Superintendent for BCC, will take on the additional responsibility for the Powhatan and Davis mine and be accountable for their respective mining operations. Additional mines that are slated to open up later on this year, the Old Union 2 and the Posey Mill 2, will also be managed within this common structure and team.
CanAm also announced the appointment of Eric Hallmark as the controller for the Alabama mining operations. In this capacity, he will have responsibility over all aspects of accounting, financial and regulatory reporting, financing and banking, taxation and general administrative matters. Hallmark joined the company in December 2011 after a 23-year career in public accounting.
“Consolidation of our operations under a common structure was the next logical step for us as we look to drive synergies and operational efficiencies across the mines”, said Jos De Smedt, CFO of CanAm. “In addition, simplification of our structure and leveraging BCC’s 30 year experience of running safe and profitable mining operations makes perfect sense as we continue our consolidation strategy in Alabama and look to exercise our BCC option in the near future.”