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Under the deal, Xinergy will acquire 1,852,367 common equity units of Elk Horn, representing about 17.5% of the private entity’s outstanding units.
Elk Horn leases its coal reserves to other parties for mining, preparation and marketing, and holds the mineral rights to 153,600 acres of coal-bearing property.
"We continue to execute on our acquisition growth strategy with our investment in Elk Horn,” Xinergy chairman Jon Nix said.
“We are taking advantage of opportunities we consider to be accretive on a near-term cash basis in the central Appalachian region and that are contiguous to our current operations."
Xinergy, based in Knoxville, already has active operations in eastern Kentucky and West Virginia. Its coal is sold to electric utilities and industrial customers in the southeastern US.
