Solid Energy agrees to buy Pike River mine

Friday 9th March 2012

State-owned coal miner Solid Energy has agreed to buy the Pike River Coal mine for an undisclosed sum.

Receivers John Fisk and Malcolm Hollis of PwC said they’ve reached agreement with Solid Energy, and the deal is set to settle in May, once due diligence is completed this month and other approvals are obtained.

“As part of the agreement, negotiations will continue with the Crown to establish a trust that will help oversee efforts to enter the main area of the mine and facilitate body recovery – if it is safe and technically feasible,” Fisk said in a statement. “No further details of the transaction or any related matter can be released until the agreement is unconditional.”

In 2009, several explosions killed 29 miners and forced the closure of the operation and led to a Royal Commission of Inquiry into what occurred. NZX-listed Pike River Coal was pushed into receivership.

In October, state-owned Solid Energy was reported as teaming up with China’s Shanxi Corp to buy the assets.

The acquisition comes a month after Solid Energy bought back the 49 percent of the Spring Creek coal mine it didn’t own for an undisclosed sum.

Solid Energy has been flagged for a partial sell-down in the government’s mixed ownership model, which is expected to kick off in the third quarter this year with MightyRiverPower.

BusinessDesk.co.nz

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