Core Natural Resources (CNR) M&A Announcement summary

Deal rationale and strategic fit

• Merger creates Core Natural Resources, a premier North American natural resource company focused on global markets, combining complementary assets and minimal customer or product overlap.

• Broad, diverse portfolio of met and thermal coal qualities enables service to multiple growth markets and geographies, with significant exposure to fast-growing Asian demand.

• Expands logistics and export capabilities, including ownership interests in two East Coast terminals and relationships with West and Gulf Coast ports.

• Both companies have pivoted toward seaborne markets, aligning long-term strategies and reducing reliance on domestic thermal coal.

• Focus on safety, environmental stewardship, and innovation, leveraging both companies' strong records.

Financial terms and conditions

• All-stock merger of equals; Arch stockholders receive 1.326 shares of CONSOL for each Arch share, with pro forma ownership of 55% CONSOL and 45% Arch.

• Pro forma 2023 revenues of ~$5.7 billion, adjusted EBITDA of ~$1.8 billion, and free cash flow of ~$1.4 billion, excluding synergies.

• Combined market capitalization estimated at ~$5.2 billion and enterprise value at ~$5.0–$5.5 billion.

• Transaction expected to be tax-free for U.S. federal income tax purposes.

• Both companies may pay up to $0.25/share quarterly dividends until closing; share repurchases suspended until completion.

Synergies and expected cost savings

• Annual cost and operational synergies of $110–$140 million expected within 6–18 months post-close.

• Synergies expected from logistics optimization, coal blending, procurement, and SG&A efficiencies.

• Transaction expected to be accretive to free cash flow in the first full year after closing.

• Additional upside possible from best practices and technological advances.