Court OKs Patriot funds

JUST a day after announcing it would file for bankruptcy protection, Patriot Coal said the bankruptcy court had approved the $US802 million in debtor-in-possession financing on an interim basis.
Court OKs Patriot funds Court OKs Patriot funds Court OKs Patriot funds Court OKs Patriot funds Court OKs Patriot funds

Image courtesy, Patriot Coal

Donna Schmidt

The DIP financing approval is from Citigroup Global Markets, Barclays Bank, and Merrill Lynch, Pierce, Fenner & Smith as joint lead arrangers.

The group has given Patriot immediate access to $677 million of financing which, along with cash from ongoing operations, will allow Patriot the ability to continue operations, including making payments to suppliers during the reorganization process.

The US Bankruptcy Court has also authorized Patriot an interim authorization for the payment of wages, furnishing of health care and other benefits.

The producer will also be able to use existing cash management systems and take other action to keep operations and shipments running as normal.

Patriot officials confirmed on Monday that after several days of speculation that it had filed for Chapter 11 bankruptcy protection. It is the first US coal producer to do so since the bottom fell out of the North American coal market.

Patriot’s bankruptcy case has been assigned to Judge Shelley Chapman.

MarketWatch reported Tuesday morning that the New York Stock Exchange suspended Patriot’s shares and commenced the delisting process, with regulators determining that the producer’s stock was no longer suitable for listing.

Other financial reports listed a trading resumption for the company on the pink sheets under the ticker PCXCQ.

Patriot is one of the largest coal miners east of the Mississippi River.

It operates 13 mining complexes in West Virginia and Kentucky and controls about 1.9 billion short tons of proven and probable reserves.

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