US coal producers Consol Energy and Arch Resources' shareholders today approved the companies' plan to merge.
With the shareholder approval taken care of, the coal mining companies expect to their merger to close on 14 January, becoming Core Natural Resources. Consol will own 55pc of the combined company and Arch will have the remaining stake.
Consol and Arch have projected Core Natural Resources to have 12mn short tons/yr (10.9mn metric tonnes/yr) of metallurgical coal capacity and 25mn st/yr of high-calorific thermal coal capacity. The merged entity also will house Arch's Powder River basin (PRB) mines, which produced a combined 34.7mn st in the first nine months of 2024 and 62.8mn st in all of 2023, according to the US Mine Safety and Health Administration.
Arch and Consol have not specified what they will do with the PRB assets. Arch chief executive officer Paul Lang said in November 2024 that plans for the company's PRB operations are a "tougher discussion", than for plans for its other assets. Arch executives in recent years have talked about shifting away from thermal coal sales, particularly for the PRB.
The new entity will have access to two east coast shipping terminals — the Consol Marine Terminal in Baltimore, Maryland and the Dominion Terminal Associates facility, which Arch co-owns with Alpha Metallurgical Resources. Core Natural Resources also will be able to ship to US west coast and the Gulf of Mexico ports.
The companies won shareholder approval despite recent stockholder concerns that prompted legal challenges following the announcement of the proposal in August 2024. Three lawsuits were filed against Consol and Arch, and the companies also received demand letters from counsel representing individual stockholders, Consol said in a recent US Securities and Exchange Commission (SEC) filing. The challenges alleged that the joint proxy statement issued by the coal producers contained "false and misleading" statements and omissions.
Consol and Arch stated that these allegations were without merit, but on 3 January the companies submitted an 8-K filing with the SEC voluntarily amending the proxy statement "without admitting any liability or wrongdoing" to prevent any delays or adverse impacts to the merger's progress.
