Form 8-K SunCoke Energy, Inc. For: Apr 06
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): April 6, 2016
SUNCOKE ENERGY, INC.
(Exact name of registrant as specified in its charter)
Delaware | 001-35243 | 90-0640593 | ||
(State of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
1011 Warrenville Road, Suite 600 | ||
Lisle, Illinois | 60532 | |
(Address of principal executive offices) | (Zip code) |
Registrants telephone number, including area code: (630) 824-1000
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.05. | Costs Associated with Exit or Disposal Activities. |
On April 6, 2016, SunCoke Energy, Inc. (the Company) issued a press release announcing the divestment of its coal mining business to Revelation Energy, LLC (Revelation). Pursuant to the terms of the transaction, which closed April 6, 2016, Revelation will receive approximately $10.3 million from the Company to take ownership of substantially all of the Companys coal mining assets, mineral leases, real estate and mining reclamation costs. The Company expects to incur approximately $2 million of additional transaction-related cash costs during the second quarter of 2015.
In conjunction with the transaction, Revelation Energy and SunCokes Jewell Coke Company, L.P. (Jewell Coke) cokemaking operations have entered into a coal supply agreement whereby Revelation will deliver approximately 300,000 tons to Jewell Coke annually for the next five years at a favorable delivered cost as compared to alternative coal sources, which is intended to provide a cost effective, local supply of high-quality, mid-vol metallurgical coal.
During the first quarter of 2015, the Company recorded a non-cash pre-tax impairment charge of $10.7 million for the write-down of property, plant and equipment in the Companys coal mining business.
A copy of the Companys press release, announcing the divestment of its coal mining business, is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.
Safe Harbor Statement
Statements contained in this report, or in the exhibit to this report, that state the Companys or managements expectations or predictions of the future are forward-looking statements intended to be covered by the safe harbor provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934. The Companys actual results could differ materially from those projected in such forward-looking statements. Factors that could affect those results include those mentioned in the documents that the Company has filed with the Securities and Exchange Commission.
Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
Exhibit |
Description | |
99.1 | SunCoke Energy, Inc. Press Release, announcing divestment of coal mining business (April 6, 2016). |
SIGNATURES
Pursuant to the requirements of the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
SUNCOKE ENERGY, INC. | ||
By: | /s/ Fay West | |
Fay West | ||
Senior Vice President and | ||
Chief Financial Officer |
Date: April 12, 2016
EXHIBIT INDEX
Exhibit |
Exhibit | |
99.1 | SunCoke Energy, Inc. Press Release, announcing divestment of coal mining business (April 6, 2016). |
Exhibit 99.1
Investors: Kyle Bland: 630-824-1907
Media: Steve Carlson: 630-824-1783 |
SUNCOKE ENERGY, INC. DIVESTS COAL MINING BUSINESS TO REVELATION ENERGY
Lisle, Ill. (April 6, 2016) SunCoke Energy, Inc. (NYSE: SXC) has divested its coal mining business to Revelation Energy, LLC in a transaction that includes substantially all of SXCs remaining coal mining assets, mineral leases, real estate and mining reclamation costs. Under the terms of the deal, which closed April 6, Revelation Energy will receive approximately $10.3 million from SXC to take ownership of the assets and associated costs. In conjunction with the transaction, Revelation Energy and SunCokes Jewell Coke operations have entered into a coal supply agreement whereby Revelation will deliver approximately 300,000 tons to Jewell Coke annually for the next five years at a favorable delivered cost as compared to alternative coal sources, which is intended to provide a cost-effective, local supply of high-quality, mid-vol metallurgical coal. SunCoke also expects to incur approximately $2 million of transaction-related costs.
The transaction is expected to be cash flow neutral to SunCoke by the end of 2017 based on avoided potential mine closure and reclamation costs of approximately $12 million. In addition, as compared to potentially closing its mines, SXC expects to realize approximately $2 million to $3 million per year of lower administrative, regulatory, compliance and purchased coal costs through 2020, as well as reduce its mining-related liabilities and collateral requirements.
Despite our aggressive efforts to reduce costs by rationalizing our mining footprint, the drastic and sustained decline in coal prices will likely prevent us from generating positive cash flow from our mining operations for the foreseeable future, said Fritz Henderson, Chairman, President and CEO of SunCoke Energy, Inc. We believe this value-positive sale will improve our long-term cash flow and allow us to focus on our core cokemaking and coal logistics businesses.
The deal excludes SunCokes legacy black lung and workers compensation liabilities, and certain properties that are necessary for Jewell Cokes operation or were unavailable for transfer based on contractual provisions. SunCoke may transfer other properties to Revelation Energy after closing, subject to required consents, for additional payment to Revelation of up to $0.7 million. The mining assets acquired by Revelation are located primarily in Buchanan and Tazewell counties in southwest Virginia.
For further information about the transaction, visit SXCs Coal Divestiture page in the Investor Resources section on www.suncoke.com
ABOUT SUNCOKE ENERGY, INC.
SunCoke Energy, Inc. (NYSE: SXC) supplies high-quality coke to the integrated steel industry under long-term, take-or-pay contracts that pass through commodity and certain operating costs to customers. We utilize an innovative heat-recovery cokemaking technology that captures excess heat for steam or electrical power generation. We are the sponsor of SunCoke Energy Partners, L.P. (NYSE: SXCP), a publicly traded master limited partnership, holding a 2 percent general partner interest, 55 percent limited partnership interest and all of the incentive distribution rights. Our cokemaking facilities are located in Illinois, Indiana, Ohio, Virginia, Brazil and India. To learn more about SunCoke Energy, Inc., visit our website at www.suncoke.com.
FORWARD-LOOKING STATEMENTS
Some of the statements included in this press release constitute forward-looking statements (as defined in Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended). Forward-looking statements include all statements that are not historical facts and may be identified by the use of such words as believe, expect, plan, project, intend, anticipate, estimate, predict, potential, continue, may, will, should or the negative of these terms or similar expressions. Forward-looking statements are inherently uncertain and involve significant known and unknown risks and uncertainties (many of which are beyond the control of SXC) that could cause actual results to differ materially.
Such risks and uncertainties include, but are not limited to domestic and international economic, political, business, operational, competitive, regulatory and/or market factors affecting SXC, as well as uncertainties related to: pending or future litigation, legislation or regulatory actions; liability for remedial actions or assessments under existing or future environmental regulations; gains and losses related to acquisition, disposition or impairment of assets; recapitalizations; access to, and costs of, capital; the effects of changes in accounting rules applicable to SXC; and changes in tax, environmental and other laws and regulations applicable to SXCs businesses.
Forward-looking statements are not guarantees of future performance, but are based upon the current knowledge, beliefs and expectations of SXC management, and upon assumptions by SXC concerning future conditions, any or all of which ultimately may prove to be inaccurate. The reader should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. SXC does not intend, and expressly disclaims any obligation, to update or alter its forward-looking statements (or associated cautionary language), whether as a result of new information, future events or otherwise after the date of this press release except as required by applicable law.
In accordance with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, SXC has included in its filings with the Securities and Exchange Commission cautionary language identifying important factors (but not necessarily all the important factors) that could cause actual results to differ materially from those expressed in any forward-looking statement made by SXC. For information concerning these factors, see SXCs Securities and Exchange Commission filings such as its annual and quarterly reports and current reports on Form 8-K, copies of which are available free of charge on SXCs website at www.suncoke.com. All forward-looking statements included in this press release are expressly qualified in their entirety by such cautionary statements. Unpredictable or unknown factors not discussed in this release also could have material adverse effects on forward-looking statements.
# # #
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Pioneer Consulting Appoints Michael Logan to Director of Business Development
- flatexDEGIRO Starts Into Expected Record Year 2024 With a Jump in Revenues and Earnings
- Century Park Partners with Total Access Elevator
Create E-mail Alert Related Categories
SEC FilingsSign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!