TerraCom Offers to Buy Remaining Shares of Unviversal Coal

On Monday TerraCom Ltd (TER) offered to acquire all the remaining shares of Universal Coal PLC (UNV) it doesn’t own in a deal worth $119.68 million.

The deal will be a cash and stock one whereby, for each Universal share held, the shareholder will be getting, 10 cents in cash and about 0.6026 of the new TerraCom shares.

Under the offer, one Universal share is valued at 33.5 cents representing a 42.6% premium from its Friday’s closing price.

According to a press statement released by TerroCom, this deal will be a mutually beneficial one as both parties will continue running their coal operations with added benefits.

“The offer will allow both companies to continue to run successful coal operations with the improved benefit of geographic diversity and an expanded production footprint,” read the statement.

Universal Coal runs its major operations in South Africa while TerracCom runs their major operations in Blair Athol, Quensland.

Australia is among the world’s largest carbon emitters per capita since the country relies heavily on coal-fired power.

The country is currently facing a global wrath due to its policy which uses old carbon credits to count toward future emission targets.