Colonial to merge with Tuya, which controls a coal reserve in British Columbia

Colonial Coal International Corp. (TSX VENTURE: CAD) and Tuya Energy Inc. said Jan. 28 that they have entered into an agreement whereby Colonial will, by way of an amalgamation between Tuya and a wholly-owned subsidiary of Colonial, acquire all of the issued and outstanding common shares of Tuya under a court-approved plan of arrangement under the Business Corporations Act (British Columbia).

Upon completion of the transaction, current Colonial shareholders and current Tuya shareholders will hold approximately 67% and 33%, respectively, of the total issued and outstanding Colonial shares. Colonial and Tuya are non-arm’s length parties by virtue of the fact that they have the same directors and management. The meetings of Colonial and Tuya shareholders to, among other things, approve the transaction are both expected to be held on or about March 19. Completion of the transaction is also subject to the approval of the Supreme Court of British Columbia and the Exchange.

Having received a fairness opinion from their respective financial advisors, legal advice and after careful consideration of such other matters as they considered relevant, the boards of directors of Colonial and Tuya have each approved the transaction and will recommend to their respective shareholders to vote in favor of the transaction.

Tuya is a privately-held, Vancouver-based, coal exploration and development company. Tuya’s principal holding is the Tuya River Coalfield property located between Telegraph Creek and Dease Lake in northwestern British Columbia, which is a thermal coal property.

Colonial is a publicly traded pure-play coking coal company in British Columbia. The northeast coal area of British Columbia, within which Colonial’s projects are located, hosts a number of proven deposits.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.