Nicholas Marshi
July 27, 2016
Ex-Private Equity Manager turned Hedge Fund Manager

July 27: Alpha Natural Resources Emerges From Bankruptcy

Coal miner Alpha Natural Resources emerges from Chapter 11.
  • Coal miner Alpha Natural Resources has emerged from Chapter 11 bankruptcy , according to the Company.
  • The now-privately held firm will operate 18 mines and have 3,000 employees.
  • A number of the Company’s other mines will be owned by a separate company set up by Alpha’s former first lien lenders, in return for debt forgiveness.
  • The new reorganized Company has reached key settlements with the U.S. Government on environmental costs, retirees and unions.
  • However, with coal prices still depressed and high environmental expenses, the future remains in doubt.
  • Only BDC exposure was to FS Investment (FSIC) with $4mn invested in 2021 Subordinated Debt at 3-31-2016, according to Advantage Data records.
  • FSIC valued the position 15% below Cost or $3.3mn.
  • Available information unclear on treatment of the Subordinated Debt in restructuring.
  • BDC Credit Reporter says: “Expect a further write down in value given the subordinated nature of obligation, and a Realized Loss in IIIQ 2016”.
  • FSIC

Coal Mining

http://bdcreporter.com/2016/07/alpha-natural-resources-emerges-from-bankruptcy/ 
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