The announcement was posted on August 3 and the company describes the transaction as a definitive agreement to sell ROVA for $5 million in cash to a company called ROVA Venture LLC.
“In December 2016, we amended our ROVA contract, relieving us from the obligation to operate the plant. This allowed us to more aggressively pursue the sale that we are announcing today. Additionally, we continue to anticipate the return of approximately $10 million of cash collateral this year related to ROVA power contracts,” said Kevin Paprzycki, Westmoreland’s CEO. “Our team did a great job executing this transaction and maximizing the realized value for the asset. This sale and the collateral return are meaningful steps towards our 2017 goals of achieving final resolutions on our two non-core assets and strengthening our balance sheet.”
The closing of the transaction, subject to customary terms and conditions, is expected to occur on or before September 30.
The sale includes all the assets of ROVA.
Westmoreland will retain approximately $2.7 million of reclamation liabilities related to offsite ash storage.
Cathy Scott, executive director of the Halifax County Economic Development Commission, could not offer details on whether ROVA Venture LLC will use the Weldon facility in the same manner as Westmoreland. “We hope this is good news for the facility and we hope the purchasers will see the value of reuse of this facility for years to come,” she said.
Talks of closing the facility first began to surface in 2013.