“The plan charts Peabody’s course forward and reflects an enormous amount of work by the company and multiple creditor groups to advance a proposal that has broad consensus, maximizes the value of the enterprise and paves the way for a sustainable future,” said Peabody Energy President and Chief Executive Officer Glenn Kellow. “We look forward to moving toward confirmation of the plan.”
The proposed plan provides for a new, sustainable capital structure that significantly reduces the pre-filing debt levels by more than $5 billion, lowers fixed charges and recapitalizes the company through a backstopped rights offering of $750 million, a private placement of mandatorily convertible preferred stock of $750 million and the issuance of new common stock to satisfy certain creditor claims.
Peabody expects to have a hearing on the disclosure statement on January 26. Following court approval, Peabody intends to send the plan and disclosure statement to creditors for approval.
“Eight months ago, we set out on a path to strengthen the balance sheet and position the company for long-term success amid historically challenged coal industry fundamentals,” said Kellow. “While we still have outstanding issues to resolve prior to emergence, this plan demonstrates that Peabody retains an unmatched asset base, leading U.S. platform, substantial Australian thermal and metallurgical coal business, and a team of skilled employees with a fundamental commitment to lasting values.”
Peabody also announced revisions to its August business plan, which includes the planned sale of the Metropolitan mine targeted for the first quarter of 2017.
Peabody anticipates emerging from bankruptcy around the beginning of the second quarter of 2017.
