Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

After receiving more than 92pc of Universal Coal shareholder’s votes on a takeover bid, TerraCom is proceeding with a compulsory acquisition. Any outstanding shares as of June 30, 2020, will allow TerraCom the ability to acquire them on the same terms of its takeover offer. 


In February, Universal Coal, which produces metallurgical and thermal coal, sought legal action against TerraCom’s unsolicited takeover offer. In response, TerraCom proceeded with block buys from shareholders.


Universal Coal has four coal mines in South Africa that include two thermal projects in Eloff and Arnot South and two large coking coal projects in Berenice and Cygnus. The coal mined at these locations is sold for export. 


The Berenice and Cygnus projects are significant metallurgical coal assets in South Africa with resources in excess of 1.35bn mt. Universal Coal submitted a mining rights application for the Berenice project to the authorities in December 2015. The miner was seeking partners but with the TerraCom takeover, the project has a higher probability of proceeding with a mining license. 

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