Cleveland Cliffs, an Ohio-based Iron and Coal company, will buy the mining company Alpha Natural Resources for $10 billion in cash and stock sources said on Wednesday. The combined company will have more than 60 coal mines in North America, South America and Australia and have nine ire ore producing facilities.
Alpha Natural Resources is a coal producer based in Virginia. The combined company will be known as Cliffs Natural Resources and have annual sales of over 30 million tons of iron ore, almost 18 million tons of metallurgical coal and will annually ship close to 17 million tons of thermal coal.
After the deal, Cleveland Cliffs’ board will expand to include two seats from current Alpha Natural Resources directors Glenn Eisenberg and Michael Quillen. Cleveland Cliffs shareholders will own 60 percent of the combined company and Alpha Natural Resources shareholders will own 40 percent.
As a result of Wednesday’s deal, Cleveland Cliffs estimates an annual savings of $200 million from streamlined coal processing and blending capabilities.