* Shares jump 20 percent on news JSW looking at NWR assets
* JSW considering offer for some mining, coking assets
* Sales would help NWR survive downturn-analysts
(Adds NWR comment, analysts, outlook)
By Jason Hovet and Jan Korselt
PRAGUE, July 2 Shares in loss-making Czech coal
miner New World Resources (NWR) jumped from
record lows on Tuesday on prospects for a cash boost from asset
sales that might help it ride out falling prices and a slump in
demand from steelmakers.
NWR, owner of the Czech Republic's only hard coal mines, is
racing to find 100 million euros in savings by cutting costs,
investment and jobs. It is also looking to sell some mines to
raise money after two straight quarters of record losses.
The company's shares rose by as much as 20 percent on the
day after Polish coal miner JSW said it was looking at
an offer to buy some of NWR's mining and coking assets, although
it had no "ready-made" stance on it.
JSW's Chief Executive Jaroslaw Zagorowski told Reuters late
on Monday that coking coal mine Paskov and NWR's flagship
development, Debiensko in Poland, were part of the offer. Other
European firms also received offers, he said.
NWR, also hit by cheap coal from the United States where
miners are battling for market share with low-cost shale gas
suppliers, said in May it had launched the sale of coking
business OKK and was looking at idling or selling some mines.
Ceska Sporitelna analyst Petr Bartek said the sale of OKK or
Debiensko would give NWR some time to wait out the market slump.
NWR, which counts ArcelorMittal and U.S. Steel as
customers, could get more than 80 million euros ($104.28
million) for OKK, he said.
That money could help cover a 78 million-euro Export Credit
Agency (ECA) covered loan, Bartek said, if NWR breaches
covenants, including exceeding net debt to EBITDA of 5 times,
when a covenant holiday is lifted after the third quarter.
"If NWR sells one of the two good assets -- the coke
business or Debiensko -- then it should have a relatively high
probability of surviving the downturn," Bartek said.
NWR posted a first-quarter net loss of 80.3 million euros
and said it had net debt of 643 million euros ($838.18 million).
NWR's market capitalisation was 5.8 billion crowns ($290.52
million) at Tuesday's prices.
Shares in NWR, whose 2008 stock listing in London and Prague
valued the company at 3.5 billion pounds ($5.33 billion), were
up 14.7 percent at 20.90 crowns by 1332 GMT but languish 77
percent below year-beginning levels versus a 25 percent fall in
the FTSE 350 mining index.
The yield on NWR's notes due in 2021 has shot up to 38
percent from just below 10 percent seen in April.
BH Securities senior analyst Petr Hlinomaz said NWR's share
price slump was overdone. "In this moment and this year the
situation (for NWR) is not that bad even when one reads about
all the debt...the maturities of the debt are longer than what
would cause the company to go bust," he said.
Analysts say rival JSW is NWR's best bet as a buyer of the
Paskov and Debiensko mines in the current market.
NWR declined again on Tuesday to comment on the proposed
($1 = 0.6568 British pounds)
($1 = 0.7671 euros)
($1 = 19.9643 Czech crowns)
(Editing by David Cowell)