The UK’s Pension Protection Fund (PPF) has raised £150m (€206m) from the sale of a property company previously owned by the industry-wide schemes for the coal sector.

The lifeboat fund agreed to sell 75.1% of Harworth Estates Property Group to Coalfield Resources (CfR), which traded as UK Coal prior to an ultimately failed restructuring meant to save the remaining UK-based coal pits from closure.

As part of the deal, the PPF will be issued with a 25% stake in Coalfield and paid a further £97m in cash.

The sale price of £150m accounts to a 20% discount on Harworth’s net asset value at the end of 2014.

Coalfield chairman Jonson Cox welcomed the deal, noting it would complete the firm’s transformation into a brownfield property developer.

“We will be in a strong position to take full advantage of our proven skills in the property and regeneration markets and to deliver value,” he said.

“I would like to thank our existing and new shareholders for their support in achieving an important milestone for the business.”

Malcolm Weir, the PPF’s head of restructuring and insolvency, was also positive about the agreement.

“We are pleased that, by working closely with CfR, we have been able deliver a significant uplift in value from the Harworth Estates holding for the PPF,” he said. 

“We look forward to continuing to work with CfR to generate further returns for the PPF and other shareholders from the PPF’s ongoing shareholding in CfR.”

Harworth Estates was established by UK Coal in 2012, with the Industry-Wide Mineworkers’ Pension Scheme (IWMPS) and the Industry-Wide Coal Staff Superannuation Scheme (IWCSSS) granted majority shares in the new firm in lieu of further deficit contribution payments. 

The restructure was signed off by regulators in an attempt to save UK Coal from insolvency.

However, the company eventually went insolvent, triggering the schemes’ entry into the PPF, after a fire closed one of its coal pits.

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