Business
American Resources Corporation Enters into Letter of Intent to Sell Carbon Mining Assets of Subsidiary American Carbon Corporation
Proposed Transaction represents a $280 million consideration and assumption of certain debts and environmental reclamation bondsFISHERS, IN / ACCESSWIRE /
About this update from American Resources Corporation
[{"type":"text","content":"Proposed Transaction represents a $280 million consideration and assumption of certain debts and environmental reclamation bondsFISHERS, IN / ACCESSWIRE / October 4, 2023 / American Resources Corporation's (NASDAQ:AREC) (\"American Resources\" or the \"Company\") subsidiary American Carbon Corporation (\"American Carbon\"), an owner and operator of low-cost, high-quality metallurgical and specialty carbon assets, has entered into a letter of intent to sell its carbon mining assets to a strategic party for the total consideration of approximately $280 million. The consideration takes the form of an upfront cash payment at closing, a share of profits generated from operations, an ongoing royalty payment based on carbon sales and minority equity interest upside. The sale includes the assets of American Carbon's McCoy Elkhorn Coal, Perry County Resources and Wyoming County Coal operating subsidiaries including certain debts and environmental reclamation bonds.Mark Jensen, CEO of American Resources Corporation commented, \"As we have been reviewing various offers and opportunities for our carbon mining division, we have remained steadfast on maximizing the value of these assets under a variety of potential transaction structures. We have worked extensively with this potential acquirers over the past several months and believe the framework of this particular LOI represents an attractive return for our shareholders. We believe the asset base is one of the last remaining low cost, highly-scalable metallurgical carbon platforms left in the United States and believe the structure enables the Company to benefit from its growth and cash return while aligning it with a highly strategic suitor to best position it within the global steal making industry.\"The letter of intent is non-binding and non-exclusive but is expected to close before year end. The proposed acquirer of the assets has committed to invest the necessary capital to bring additional mines into full production and expand the number of producing mines over American Carbon's extensive infrastructure base including the Company's Wyoming County Coal's premium mid-vol carbon complex. Concurrent with the executed letter of intent, American Resources will continue to advance its Form-10 filing of spinning-off American Carbon out into its own public, pure play metallurgical carbon gro...