NATIONAL COAL CORP.
COMPLETES ACQUISITION OF MANN STEEL PRODUCTS, INC.
Knoxville, Tenn. – (October 19, 2007) – National Coal Corp. (Nasdaq: NCOC) announced today it has
completed its previously announced Stock Purchase Agreement with
Mann Steel Products, Inc. (Mann Steel) for $55 million. The
transaction was funded through a combination of $60 million in
debt financing and $12 million of equity. The equity financing
was raised through a private placement of 4 million shares of
common stock at $3.00 per share.
Under the terms of the agreement,
National Coal Corp. has acquired 100% of Mann Steel and renamed
the company National Coal of Alabama, Inc. As a result of this
transaction, National Coal will have more than 350 employees and
a total production capacity of approximately 3 million tons. Sales
during 2007 for the combined company are expected to reach
approximately 2.6 million tons and are anticipated to generate
about $140 million in annualized sales.
“Closing this transaction
represents a significant milestone in our history and an
important step in building shareholder value. In a fiscally
responsible manner, we have essentially doubled our sales and
increased our production capabilities by about 50%,” said
Daniel Roling, President and CEO of
National Coal. “The Mann Steel acquisition will strengthen
both our financial operations and physical presence in the Central
and Southern Appalachian regions. Our production mix will now
change with surface mining accounting for about 65%, underground
28%, and 7% from high wall mining. In addition, an increase in
volume should more efficiently leverage the infrastructure investments
we’ve made in wash plants, railroad load-out facilities,
and our railroad. At the close of this transaction, I believe we
are closer to our goal of further defining our leadership role in
the production and supply of industrial and steam coal in the Southeastern U.S.”
Frank Mann, former President of Mann
Steel Products and now a consultant to National Coal of Alabama,
Inc., is also pleased to add this milestone to his
company’s history. “We are looking forward to the
positive changes this transaction will bring to our employees and
our operations. Together with National Coal we have an
opportunity to really develop a presence within this region and
make improvements designed to benefit all of our
stakeholders.”
Both Frank and William Mann are now
investors in National Coal Corp. as well as remain consultants to
the newly formed company.
“I am looking
forward to this new chapter in our company’s history as it
is now positioned for additional growth which should be positive
for our employees, suppliers, and customers. I am pleased to be a
part of these positive changes,” said William Mann, former
Vice President of Mann Steel Products.
Mann Steel produces coal from three surface mines which have a
capacity of approximately 1.0 million tons. During 2006, Mann
Steel sold approximately 860,000 tons of coal and generated
revenues of $55.2 million. For the first half of 2007, coal sales
totaled about 502,902 tons and
generated revenues of $33.1 million.
About National Coal
Corp.
Headquartered in Knoxville, Tenn., National
Coal Corp., through its wholly-owned subsidiary, National Coal
Corporation, is engaged in coal mining in Tennessee
and Kentucky, and through its
wholly-owned subsidiary, National Coal of Alabama, is engaged in
coal mining in Alabama.
Currently, National Coal employs approximate 350 people.
National Coal sells industrial and steam coal to customers in the
Southeastern
United States. For more information visit www.nationalcoal.com.
Information About Forward-Looking Statements
Except for historical information contained herein, the
statements in this release are forward-looking and made pursuant
to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements are inherently unreliable and actual results may
differ materially. Examples of forward looking statements
in this news release include the anticipated benefits to National
Coal of the acquisition of Mann Steel, projected increases in
coal production, and projected financial performance. Factors
which could cause actual results to differ materially from these
forward-looking statements include risks associated with the
acquisition of an operating company, including difficulties
associated with the integration of the acquired business with
National Coal’s existing business. These and other
risks are more fully described in the Company's filings with the
Securities and Exchange Commission. The Company undertakes
no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise.
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