Restructure sees Coalfield Resources sever mining links
COALFIELD Resources, the company that emerged from a restructured UK Coal last year, has severed all ties to the group’s mining arm after it went into administration.
Administrators from PwC have been appointed to UK Coal Mine Holdings and UK Coal Operations as a result of the February fire at Daw Mill mine, Warwickshire, which threatened the ongoing viability of its remaining two deep mines and six surface mines.
The move has saved around 2,000 jobs but there will be 350 redundancies at Daw Mill.
Doncaster-based Coalfield Resources, whose largest shareholder is Manchester’s Peel Group, said it would have no equity interest in, nor any responsibility for, on-going mining operations as a result of the administration. It previously held a minority interest and a governance role alongside the employee benefit trust that controlled the mining operation.
The December restructuring separated UK Coal’s mining and property assets and put responsibility for the £450m pension deficit with the coal side of the business. This has now been transferred to the Government-backed Pension Protection Fund (PPF).
Coalfield Resources’ main asset is a 24.9% stake in Harworth Estates which holds £260m of property, including Cutacre, a former former mine site near Bolton which retailer Aldi has chosen for a new regional distribution hub.
It said it is planning an equity fundraising in the next few months, underwritten by Peel Group, to cover £3.5m of professional fees incurred in last year’s restructuring.
Jonson Cox, Chairman, said “The 2012 restructuring of UK Coal separated the property and mining interests. While the catastrophic fire at Daw Mill could not be foreseen, the 2012 restructuring has justified the precautions taken to ensure that such an event would not bring down all parts of the former group.
“Coalfield Resources plc has played an active part in finding a solution for the mines and preserving 2,000 jobs. The company’s role in the mining business is now at an end and the current economic value is in its shareholding in Harworth Estates. The company will continue to be an active investor seeking long-term value for both its own shareholders and the PPF.
“We look forward to working closely with the PPF to realise the value inherent in Harworth Estates, and we wish former colleagues in mining well in their new structure”.
