Coalcorp Mining Inc. (CCJ.TO) announced that it has entered into a mediation order with AES Gener S.A. which provides that the proceeding initiated by AES seeking a temporary restraining order and preliminary injunction requiring Coalcorp's subsidiary, Compania Carbones del Cesar or CDC, to retain a minimum of US$30.7 million from the proceeds of the previously announced proposed sale by CDC of the La Francia mine and related infrastructure assets to a subsidiary of The Goldman Sachs Group Inc. is discontinued with prejudice.
The mediation order further provides that the parties have agreed that Coalcorp, on behalf of CDC, will pay AES US$5.5 million upon the earlier of the closing of the Proposed Transaction or, within 45 days of the mediation order and all parties will exchange releases, and AES will discontinue its arbitration against CDC with prejudice and will relieve CDC from any obligations under the coal supply agreement in dispute with AES.
As a result of the foregoing, Coalcorp intends to proceed with the completion of the Proposed Transaction which it intends to close on March 19, 2010. Coalcorp's outstanding offer to repurchase its outstanding 12% senior secured notes, which expires on the business day immediately prior to the closing date of the Proposed Transaction, will now expire no earlier than on March 18, 2010.
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