Coalspur Mines Ltd. (ASX:CPL) (TSE:CPT), which has Canadian coal mining assets, said March 17 that progress is being made on the proposed acquisition of Coalspur by KC Euroholdings S.a r.l. (KCE) by way of a scheme of arrangement.
The Federal Court of Australia has approved the despatch of Coalspur’s Scheme booklet and has ordered that Coalspur convene a meeting of its shareholders to consider and, if thought fit, approve the scheme. The Scheme Booklet will be released on the ASX and SEDAR information services following registration with the Australian Securities and Investments Commission (ASIC).
The Scheme Meeting will be held at The Celtic Club in West Perth, Western Australia, on April 22. In the event that the scheme is approved at the Scheme Meeting and all conditions of the scheme are satisfied or waived, Coalspur will apply to the court for orders approving the scheme. The Board of Directors of Coalspur unanimously recommends that Coalspur shareholders vote in favor of the proposed scheme, in the absence of a superior proposal for Coalspur.
Coalspur Mines had announced this deal on Feb. 24. KCE is the parent company of Kameron Collieries ULC, the new owner of the Donkin coal mine in Nova Scotia, Canada, and is an affiliate of the Cline Group LLC, which was founded by coal operator Chris Cline and is a major coal producer in the United States. KCE will fund the acquisition from internal cash sources. The transaction with KCE represents the culmination of a strategic review process that was announced by Coalspur in June 2014.
“The acquisition of the high quality Vista asset in Alberta will combine well with our recent purchase of the Donkin mine in Nova Scotia and advances our strategy to service growing international markets through a low cost coal production platform” said Paul Vining, Chief Executive Officer of KCE, who recently left major U.S. coal producer Alpha Natural Resources (NYSE: ANR) to handle non-U.S. coal projects for Cline. “We look forward to working with key stakeholders as we develop Vista and our other international businesses.”
Coalspur is a coal development company with approximately 55,000 hectares of coal leases located within the Hinton region of Alberta, Canada. Coalspur’s flagship project is Vista, which covers approximately 10,000 hectares and provides a large scale, surface mineable, thermal coal development. Vista is located adjacent to CN Rail’s main line, which is suitable for the transport of coal to deepwater ports on Canada’s west coast. Coalspur has secured a port allocation agreement with Ridley Terminals, which is essential to the logistics supply chain necessary to export coal from Vista to the growing thermal coal demand from countries in the Asia Pacific region.