When I heard our Mr Spindler say "we are well positioned and focused on accretive acquisition opportunities as met coal markets look to consolidate" my trigger finger hovered closer to the sell button on the remaining CRN parcel.
Acquisitions have a place - when the target is distressed and materially underpriced, when the acquirer's management can extract further efficiencies or growth from the target, or when there are economies of scale or some value to be created out of a consolidation that outweighs the acquisition premium.
It's hard to imagine any of these factors being true for Coronado. Their track record as capital allocators is abysmal.
If we as investors want to own other coal companies, we're free to do so via the equity markets. If we're clever about it we can buy them at a much better price than another corporate behemoth is able to.
CRN Price at posting:
$1.98 Sentiment: Hold Disclosure: Held
(20min delay)
