Central European mining firm New World Resources (NWR) said it planned to sell its OKK coking plant to offset losses. The losses resulted from the decline in coal prices. NWR Chief Financial Officer Mark Jelinek told Bloomberg in a phone interview that the company is currently in the midst of share-purchase agreement negotiations with potential buyers. "We have a good chance of closing the sale and receiving the cash before the end of this year," he added.
News of the sale was apparently welcomed by investors as NWR shares increased by as much as 13%. The Amsterdam-registered hard coal and coke producer started posting losses last year when demand from energy utility companies and steelmakers fell. From April to June this year, NWR also posted losses of EUR 315.4 million or USD 421 million.
In his comments emailed to Bloomberg, J&T Banka Analyst Bohumil Trampota observed, "When adjusted for the impairment, the results are better than expected. Negotiations on the OKK sale and its expected completion by the end of 2013 could support the company's liquidity, along with the cost savings."
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