'Coal is on the slide. Investment analysis predicting structural decline for the industry is piling up, including the likes of Bernstein Research, Deutsche Bank, Citigroup, Standard and Poor’s and Moody’s rating agencies all pointing to a bleak long-term future for coal.'
IMO this deal with CoAL is the last opportunity UNV shareholders will have to make a profit. Sure the peak in coal consumption will still take a couple of years to occur. But the reality is that the number of Chinese (10 of 34 provinces having pledged to peak coal consumption by 2017) provinces will only increase.
The consumption of coal will not disappear from the world's energy use. But like oil, a crash in the selling price will mean zero profit at some point in the near future. Just look at the lowest cost producers and see how little profit they are currently making: Peabody, BHP, RIO.
A failed takeover will mean a return to UNV's former share price.
UNV Price at posting:
20.0¢ Sentiment: Buy Disclosure: Held
