Business
DISPOSAL OF INTEREST IN COAL4
DISPOSAL OF INTEREST IN COAL4.
About this update from Harworth Group Plc
[{"type":"text","content":"\n RNS Number : 3516M UK Coal PLC 28 January 2009 \n \n28 January 2009\n\n\nUK COAL PLC\n\nDISPOSAL OF INTEREST IN COAL4ENERGY LIMITED\n\n\nUK Coal PLC ('UK Coal' or the 'Group') today announces that its wholly-owned subsidiary, UK Coal Mining Limited, has completed the disposal of its 50% interest in Coal4Energy Limited ('Coal4Energy') (the 'Disposal') to its joint venture partner, Hargreaves Services PLC ('Hargreaves') for a total cash consideration of £9.0m, payable in full on completion.\n\nCoal4Energy markets and sells domestic and industrial coal produced by the Group and coal supplied by Hargreaves. The net profit to the Group from the Disposal is estimated to be around £7.0m, and the proceeds will be used to reduce borrowings and fund investment. The Disposal is not expected to have a significant impact on the Group's operations. \n\nUK Coal Mining Limited has also today agreed to continue supplying circa 250,000 tonnes per annum of certain coals for the domestic and industrial market to Coal4Energy Limited under a new exclusive, five year supply agreement.\n\nCoal4Energy contributed £0.5m to the Group's profit before tax for the year to December 2007 and £0.6m to the Group's unaudited profit before tax for the 6 months to June 2008., The investment in Coal4Energy was shown in the Group's balance sheet at £0.3m at December 2007 and £1.0m at June 2008. The estimated book value of the gross assets of Coal4Energy on completion is approximately £19.0m of which the Group's 50% share is approximately £9.5m.\n\nJon Lloyd, Chief Executive of UK COAL, said: 'This is a good deal for both parties. Coal4Energy is an attractive business; but it is not core for us, and its future prospects will continue unaffected. For us, the disposal price is attractive, we continue to supply the coal, and we reinforce our ability to invest in our core mining business.' \n\nFor further information please contact:\n\nMedia:\n\n\n\n\n\nAnthony Carlisle, Citigate Dewe Rogerson\n\n\nTel: +44 (0) 20 7638 9571\nMobile: +44 (0)7973 611 888\n\n\n\n\n\nAnalysts and investors:\n\n\n\n\n\n\nJon Lloyd (Chief Executive, UK COAL)\n\n\nTel: +44 (0) 1302 755 002\n\n\n\n\nDavid Brocksom (Finance Director, UK COAL)\n\n\nT...