The closure comes nearly six weeks after the pair first confirmed the deal on October 28, putting to rest months of speculation and rumour of a potential sale.
Murray Energy has taken possession of the mines in Consol’s portfolio that were known as McElroy, Shoemaker, Blacksville, Loveridge and Robinson Run.
The Ohio miner, which renamed Consolidation Coal as Murray American Energy, has changed the names of all five complexes.
The Shoemaker mine will be known as Ohio County Coal Company’s Ohio County mine; the Marshall County Coal Company’s Marshall County mine was formerly McElroy; Loveridge is Marion County Coal Company’s Marion County mine; the Harrison County Coal Company Harrison County mine was formerly Robinson Run; and Blacksville will be Monongalia County Coal Company’s Monongalia County mine.
No name changes or adjustments were announced for the associated assets Murray gained with the purchase, including Condolidation Coal’s river and barge operations.
Included in the segment in the deal was a fleet of 21 towboats and 600 barges.
Murray Energy and its subsidiary companies will employ approximately 7100 workers and operate 13 active mines, consisting of 12 underground longwall mining systems and 46 continuous mining units.
The company will produce about 60 million short tons annually and will have reserve holdings of more than 2.3 billion tonnes.
Consol said wrapping up the $US3.5 billion sale – $850 million of which was in cash – before the close of the year helped it bring increased concentration to its oil and gas business.
“The completion of this complex transaction this year enables us to enter 2014 with our focus of achieving our gas growth production targets of 210-225 billion cubic feet equivalent for 2014 and 30% annual gas production growth in 2015 and 2016,” chairman and chief executive officer J Brett Harvey said.
Consol is also significantly de-levering its balance sheet in the transaction, as Murray has acquired $2.4 billion of its balance sheet liabilities in the deal along with the Pittsburgh-based miner’s United Mine Workers of America 1974 Pension Trust obligations, which have a value of approximately $941 million.
Murray said the production and reserve base would allow it to provide better service to its electric utility customers.
“The focus at Murray Energy is on operating very safe coal mines, with a particular emphasis on fire protection and emergency preparedness,” the company said, adding that worker health and safety was foremost.
“This is truly a transformative event for Murray Energy and its combined employees.”
Deutsche Bank Securities acted as financial advisor to Murray Energy, while Goldman Sachs and Deutsche Bank provided committed financing to Murray Energy in connection with the purchase.
Stifel, Nicolaus & Company acted as the primary financial advisor to Consol Energy in the transaction and BofA Merrill Lynch was also a financial advisor.
Greenberg Traurig; Wachtell, Lipton, Rosen & Katz; Steptoe & Johnson; and Buchanan Ingersoll & Rooney acted as legal counsel.
