Arch Resources Inc (NYSE:ARCH) announced on Wednesday it has agreed to merge with CONSOL Energy to create a coal mining giant valued at approximately $5.2 billion called Core Natural Resources.
For the all-share deal, Consol will issue 1.326 shares for each share of Arch Resources.
Upon closing, Arch shareholders will own approximately 45% of Core Natural Resources and CONSOL stockholders will own approximately 55%.
The combined company will own 11 mines and have access to global markets through ownership interests in two export terminals on the US Eastern seaboard.
The merger is expected to generate $110 million to $140 million in annual cost and operational synergies, the companies said.
“We are excited to bring our companies together to create a new industry leader that is ideally positioned to meet the rising demand for critical resources and energy around the world,” CONSOL Energy CEO Jimmy Brock said in a statement.
Arch Resources CEO Paul Lang added: “Core Natural Resources will enjoy the benefits of CONSOL’s growing seaborne thermal business focused on industrial applications coupled with Arch’s significant exposure to attractive global metallurgical coal markets.”
The merger is expected to close by the end of the first quarter of 2025.
Following the announcement, shares of CONSOL added 3.3% at $98 while Arch added 1.2% at $128.