American Carbon Corp., a subsidiary of American Resources Corp., a metallurgical and specialty coals producer, said it has entered into a binding letter of intent to sell certain assets associated with its Deane mining complex for $20.6 million. The buyer was not disclosed. American Resources (Quest Energy at the time) bought the idled assets, which included the 800 tph Mill Creek prep plant, a unit train loadout on the CSX line and several other properties and permits in eastern Kentucky, from a distressed Rhino Resources in December 2015. American Energy restarted operations at the Deane Complex in October 2017.
“The sale of the assets associated with the Deane Mining complex, which we view as a fantastic complex, but ultimately non-core to the direction of American Carbon Corp., will further position American Carbon as a low-cost, streamlined, and pure-play growth platform in the metallurgical carbon industry,” American Resources CEO Mark Jensen said. He said the company is also considering a spin-off of American Carbon Corp. and relocating or selling its Perry County Resources’ assets.
The structure of the sale transaction is $1 million upfront, which includes an already received $200,000 deposit, $500,000 quarterly cash payments thereafter for a total cash consideration of $11.5 million, and the assumption and replacement of approximately $9.1 million in environmental reclamation bonds.