Teco drops sales agreement with Cambrian Coal
OREANDA-NEWS. August 19, 2015. Utility holding company Teco Energy terminated a nine-month-old agreement for the sale of its coal mining subsidiary to Booth Energy Group subsidiary Cambrian Coal.
Teco still is keen to sell its coal unit to focus on its core business of natural gas and power utilities. Teco Coal owns mining assets in Tennessee, Kentucky and Virginia, with 192mn st of proven thermal and metallurgical coal reserves in 2014, based on regulatory filings.
The October 2014 agreement with Cambrian initially valued Teco Coal at \\$220mn but the sales price dwindled to \\$140mn earlier this year. Even then, Cambrian was unable to raise enough capital externally to close the deal. Another, unidentified buyer walked away from the sale in early July.
Teco said in a filing with the Securities and Exchange Commission yesterday that it will terminate the sales agreement with Cambrian effective on 21 August, but will continue pursuing a sale.
Teco's balance sheet values coal assets held for sale at \\$97mn as of the end of June. The amount matches Teco Coal's liabilities, yielding a net accounting value of nil for the unit.
Outside of the coal unit sale, Teco is looking to restructure itself, with options including a sale of the entire company. The company owns Florida utilities Tampa Electric and Peoples Gas System and Albuquerque-based New Mexico Gas.
Комментарии