Consol completes buyback of CNX Gas spinoff
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Cecil-based Consol Energy Inc., which is transforming itself from a coal company to a diversified energy company, has completed its buyback of CNX Gas Corp., the natural gas subsidiary that was spun off as a stand-alone company five years ago.
Consol is paying $38.25 for the shares surrendered by other shareholders in the re-acquisition that began in March, with the purchase of 9.5 million shares from investment advisory firm T. Rowe Price Associates Inc., acting on behalf of its clients.
Between the payments to T. Rowe Price and those to other shareholders, Consol is paying about $1.3 billion to regain full ownership of CNX Gas. Upon completion of the transaction, which was structured as a merger, CNX Gas became a wholly-owned subsidiary of Consol Energy again and its ticker symbol, CXG, was delisted Tuesday from the New York Stock Exchange.
It could be argued that CNX was never fully independent, as Consol always held 80 percent or more of the company's shares, even after CNX went public in early 2006. The two consolidated management in 2009.
Created to exploit the potential of the coalbed methane that was released by Consol's mining operations, the company's initial expansion into drilling for natural gas in the Marcellus Shale, a geological formation underlying much of Pennsylvania, was made easier by being able to do it on Consol's considerable acreage, rather than having to acquire leases from third-party landowners.
First Published June 2, 2010 12:00 am
