Patriot Coal Emerges from Bankruptcy as Well-Capitalized Private Company
12/19/2013 - Patriot Coal Corp. announced its emergence from Chapter 11 as a reorganized company.
The company exits the 18-month restructuring process with a strong balance sheet, competitive cost structure, and streamlined operating profile focused on market opportunities that create value.
"Today marks an exciting new beginning for our company and for our employees," said Patriot president and chief executive officer Bennett K. Hatfield. "We have accomplished the objectives of our reorganization and emerged in a much stronger position to compete in the global energy and steel markets. Importantly, we have also preserved nearly 4,000 jobs, signed new five-year labor agreements with the UMWA, and secured significant funding for retiree healthcare."
Patriot emerges from Chapter 11 reorganization with a:
Emergence Details
Patriot completed the final steps in its Chapter 11 restructuring on 18 December 2013 by successfully closing US$545 million in exit financing, with portions of the exit financing led by Barclays Bank PLC and Deutsche Bank Securities Inc., and completing its rights offerings, receiving US$250 million of junior capital from Knighthead Capital Management, LLC and other participating unsecured creditors.
The company has filed notice of the effectiveness of the Plan of Reorganization with the U.S. Bankruptcy Court for the Eastern District of Missouri. Upon the effectiveness of the Plan, all previously issued and outstanding shares of Patriot common stock were cancelled, as were all other previously issued and outstanding equity interests and bonds. Patriot issued shares of a new class of common stock to unsecured creditors as provided in the Plan. Additionally, the company issued notes and warrants pursuant to the rights offerings. Patriot expects to make initial distributions to unsecured claim holders in the first quarter of 2014.
As a result of the effectiveness of the Plan, Patriot is a private company and is no longer subject to the reporting requirements of the U.S. Securities and Exchange Commission. However, Patriot plans to release certain financial results and other information on at least a quarterly basis.
Patriot Coal is a producer and marketer of coal in the eastern United States, with 10 active mining complexes in Appalachia and the Illinois Basin. Patriot ships to domestic and international electricity generators, industrial users and metallurgical coal customers, and controls approximately 1.8 billion tons of proven and probable coal reserves.
"Today marks an exciting new beginning for our company and for our employees," said Patriot president and chief executive officer Bennett K. Hatfield. "We have accomplished the objectives of our reorganization and emerged in a much stronger position to compete in the global energy and steel markets. Importantly, we have also preserved nearly 4,000 jobs, signed new five-year labor agreements with the UMWA, and secured significant funding for retiree healthcare."
Patriot emerges from Chapter 11 reorganization with a:
- Strong balance sheet. The company has lower debt levels and higher available liquidity, with dramatically reduced legacy liabilities related to retiree healthcare and other post-employment benefits.
- Competitive cost structure. Patriot has significantly reduced its operating costs, achieving more than US$200 million in estimated annual cash savings.
- Industry-leading assets and reserves. The company has 1.8 billion tons of coal reserves, state-of-the-art mine complexes in three U.S. coal basins, and broad transportation optionality.
- Solid customer base. Patriot has long-standing relationships with prominent U.S. and international utility customers, steel producers, and energy trading companies.
Emergence Details
Patriot completed the final steps in its Chapter 11 restructuring on 18 December 2013 by successfully closing US$545 million in exit financing, with portions of the exit financing led by Barclays Bank PLC and Deutsche Bank Securities Inc., and completing its rights offerings, receiving US$250 million of junior capital from Knighthead Capital Management, LLC and other participating unsecured creditors.
The company has filed notice of the effectiveness of the Plan of Reorganization with the U.S. Bankruptcy Court for the Eastern District of Missouri. Upon the effectiveness of the Plan, all previously issued and outstanding shares of Patriot common stock were cancelled, as were all other previously issued and outstanding equity interests and bonds. Patriot issued shares of a new class of common stock to unsecured creditors as provided in the Plan. Additionally, the company issued notes and warrants pursuant to the rights offerings. Patriot expects to make initial distributions to unsecured claim holders in the first quarter of 2014.
As a result of the effectiveness of the Plan, Patriot is a private company and is no longer subject to the reporting requirements of the U.S. Securities and Exchange Commission. However, Patriot plans to release certain financial results and other information on at least a quarterly basis.
Patriot Coal is a producer and marketer of coal in the eastern United States, with 10 active mining complexes in Appalachia and the Illinois Basin. Patriot ships to domestic and international electricity generators, industrial users and metallurgical coal customers, and controls approximately 1.8 billion tons of proven and probable coal reserves.
