Phoenix Coal Signs Agreement To Sell Gryphon Reserve

Published: 17-Mar-2010

Phoenix Coal has entered into an agreement to sell Gryphon reserve, which is comprised of the property leases controlled through the acquisition of Pact Resources and the Petersburg sublease, and certain other associated assets to a US-based coal producer. The proceeds from the sale of the Gryphon assets are $23m in cash.

Upon closing of the transaction, Phoenix Coal will have divested all of its material coal properties and is expected to have an estimated $56.2m of restricted and unrestricted cash.

David Wiley, president and CEO of Phoenix Coal, said: "We have generated a significant amount of cash from the sale of our coal assets. In so doing, we have positioned the company to redeploy its capital in compelling opportunities in the natural resources and mining sectors.

“Members of our management team and board of directors have a long track record of consistently creating shareholder value in the mining sector, and we are in the process of evaluating potential acquisitions."

The transaction is subject to the approval of Phoenix Coal's shareholders and other customary closing conditions. The board of directors of the company has approved the terms of the agreement.

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