Westmoreland Coal completed the acquisition of the Farmington, NM-based San Juan Mine for a purchase price of approximately $127 million.

To finance a portion of the transaction, Westmoreland entered into a $125 million structured loan with NM Capital Utility, a subsidiary of PNM Resources. The loan is a $125 million senior secured non-revolving term loan maturing February 1, 2021. It bears initial interest at a 7.25% rate plus LIBOR, which escalates over time. There are no prepayment penalties and the loan is structured such that greater than half the balance is due to be repaid in the first two years.

BMO Capital served as capital markets advisor for the transaction.

“The addition of the San Juan Mine further enhances our mine mouth business model, which has been fundamental in providing strong cash generation,” said Kevin Paprzycki, Westmoreland’s chief executive officer. “We look forward to building upon the solid partnership with the SJGS team in the years to come.”