Business
American Resources Strengthens Balance Sheet and Capital Structure with Divestiture of Idle Assets and Strategically Positions for Accretive Growth
Strategic divestiture of idle assets and environmental liabilities outside of five-year plan significantly reduces liabilities, holding costs and shares
About this update from American Resources Corporation
[{"type":"text","content":"Strategic divestiture of idle assets and environmental liabilities outside of five-year plan significantly reduces liabilities, holding costs and shares outstandingCompany extinguishes $2 million note associated with the original asset purchase and receives back 2,000,000 shares of its Class A common stockCompany pioneering a more nimble, efficient and modernized business model for the infrastructure industry and positioning for long-term exponential growthFISHERS, IN / ACCESSWIRE / May 13, 2020 / American Resources Corporation (NASDAQ:AREC) (\"American Resources\" or the \"Company\"), a supplier of raw materials to the rapidly growing global infrastructure marketplace with a primary focus on the extraction, processing, transportation and distribution of metallurgical carbon to the steel and specialty metals industries, today announced the divestiture of certain surface and mineral acres located near Phelps, Kentucky. American Resources acquired these assets in February 2019, prior to the acquisition of other assets considered to be more core to the Company's near and intermediate term growth plans. This strategic divestiture of these idle assets and environmental liabilities outside of the Company's five-year business plan significantly reduces liabilities, holding costs and shares outstanding.Consideration for the assets being sold is the extinguishment of the entire $2,000,000 note associated with the original asset purchase and American Resources receiving back 2,000,000 shares of its Class A common stock. Additionally, American Resources will be removing over $2.6 million of associated reclamation liabilities (asset retirement obligations) from its balance sheet. The reduction of liabilities and holding costs will enable the Company to further enhance the flexibility of its focused supply base in anticipation of worldwide infrastructure related demand. Given the current dynamics in the market over the next six to twelve months, the Company remains focused on driving its organic growth business model along with other strategic, attractively priced opportunities to maximize return to shareholders and strengthen the Company.Mark Jensen, Chairman and CEO of American Resources Corporation commented, \"We're very pleased with the outcome of the divestiture of this idle and non-core property. Having the additional flexibility and ...