Vote on Massey-Alpha Coal Merger
Shareholders of Massey Energy and Alpha Natural Resources will vote Wednesday on a proposed merger. If approved, the deal would make Alpha the world’s third largest producer of metallurgical coal. The company has said it intends to retain five Massey executives, all of whom were in leadership positions during the Upper Big Branch explosion last year in West Virginia.
The Change to Win Investment Group, which works with union pension funds, doesn’t oppose the merger but is pressing Alpha to rescind employment offers to the former Massey employees. “Alpha needs to very clearly demonstrate that it is committed to fundamentally changing the way Massey did business,” said Per Olstad, CtW’s financial initiatives manager. “And by retaining these executives, they are very definitely not doing so.” Badge Humphries is an attorney representing several shareholder groups that have pending lawsuits against the same executives, as well as two mine operators who headed the Massey subsidiary where the explosion occurred.
Humphries says Alpha’s move to hire those key players implies the company accepts Massey’s explanation of the disaster as an ‘act of God.’
“This merger with Alpha at this price, which we also allege is inadequate to compensate shareholders of Massey Energy, was also entered into to help these directors and officers escape liability,” he said.
Normally the claims would transfer from Massey to Alpha with the merger. But Humphries is concerned Alpha won’t honor the suits. He’s seeking an exception to allow his lawsuits to proceed against the Massey executives.
Both Massey and Alpha operate mines in Kentucky.