Arch Coal, Peabody to Combine Coal Mines in Joint Venture (1)

Arch Coal Inc. and Peabody Energy Corp., the two largest U.S. coal producers, are combining their mines in Wyoming and Colorado through a joint venture expected to create about $820 million in synergies.

Peabody will be a 66.5% owner of the joint venture and serve as operator, the companies said in a statement June 19. The two miners will share profits and capital requirements in proportion to their ownership percentages. They’ve been talking about the combination for “a fairly substantial time,” Vic Svec, Peabody’s head of investor relations, said in an interview.

The deal comes as coal is being ravaged ...