The bid for Massey Energy (NYSE:MEE) by Alpha Natural Resources (NYSE:ANR) was stated to be a deal to create a huge coal export company, according to CEO Kevin Crutchfield.
Crutchfield said the deal will create a company that would produce over 27 million tons of metallurgical coal by 2013. Metallurgical coal generates higher prices.
Alpha Natural Resources will start adding to earnings from the deal in 2012, added Crutchfield.
The takeover is valued at $7.1 billion, whereby Massey shareholders will receive $10 a share and 46 percent of the new company's stock.
Both boards gave unanimous approval for the deal to go forward.
Alpha Natural Resources was trading at $53.41, dropping $4.47, or 7.72 percent, as of 11:55 AM EST. Massey was trading at $62.77, gaining $5.55, or 9.68 percent.
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