Arch Coal is to defer interest payments to its senior note holders, the company has announced in a press statement. The embattled coal miner is to exercise a 30-day grace period included in the indenture agreements with its note holders, allowing to delay US$90 million of payments that were originally due 15 December.
“Arch intends to use the 30-day grace period to continue constructive discussions with various creditors regarding its ongoing effort to develop and implement a comprehensive plan to restructure its balance sheet,” the company said.
In its 3Q15 results statement, the company warned that it risked entering Chapter 11 bankruptcy in the new year after admitting it would be unable to continue to service its debt in current markets.
“Arch will require a significant restructuring of its balance sheet to continue to operate as a going concern over the long-term,” said its Chief Financial Officer, John Drexler, in its 3Q15 results. “We are currently in active dialogue with various creditors with respect to a restructuring of our balance sheet.”
The company also recently said it had been told by the New York Stock Exchange that it was in breach of its listing standards after its average market capitalisation dropped below US$50 million of a 30-day period.
In the latest press release, the company stressed it had sufficient liquidity to continue normal mining operations, reporting more than US$694.5 million in cash and short-term investments at the end of September.
Edited by Jonathan Rowland.
Read the article online at: https://www.worldcoal.com/coal/15122015/arch-coal-delays-interest-payments-3290/