UK Coal receives approach, but not from Peel
UK Coal, Britain’s largest coal mining company, today said it was assessing a merger approach that could mitigate the effects of its exposure to deep mines.
The Doncaster-based group stressed, however, that it hadn’t received a cash offer from its major shareholder, Manchester-based Peel Holdings, or any other source following speculation in a national newspaper.
UK Coal said in a statement today: “It is emphasised that this proposal is highly conditional and at a very preliminary stage and no view can be expressed as to whether a transaction will result.”
The Daily Mail reported today that UK Coal shareholder Peel Holdings had rejected an apporach for its 28.3% stake in the group because Peel itself was working on a cash offer.
Shares in UK Coal were up 10% at 58p earlier today.
Its shares have lost almost 30% of their value so far this year over worries over the volatile performance of its deep mines.
UK Coal, which has five deep mines in the UK, said that production at Daw Mill near Coventry, will now only start during April, rather than around the end of March.
“The exposure of the group to the volatile performance in its deep mines is a significant concern to the directors and mitigating the effects of this exposure, by operating improvements or structural means, is a priority,” UK Coal said in the statement.
