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Patriot Coal Statement of Support Filed

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According to the U.S. Bankruptcy Court docket, Patriot Coal’s D.I.P. lenders filed a statement reflecting their support of the Debtor’s Fourth Amended Joint Plan of Reorganization.

The statement explains, “The DIP Lenders have done nothing but lose money on Patriot for the benefit of every Patriot constituency other than the DIP Lenders. To recap, the DIP Lenders’ prepetition claims are now virtually worthless; the $100 million DIP Facility will not be repaid any time in the near future; and the DIP Lenders are the only creditors participating in the $130 million additional financing needed to consummate the Plan.”

The D.I.P. lenders continue, “It is reckless and counter-factual for any objector to allege that any of the DIP Lenders ‘planned’ serial chapter 11 cases to the detriment of other creditor constituencies. The DIP Lenders have opened their check books for the last time. There is no more money or appetite for investment. The only alternative before the Court is a cash sale of assets to the Debtors’ backup bidder, Coronado Mining, in which case the DIP Lenders will be paid, the rest of the cash goes into a pot to be fought over for the foreseeable future, there is no deal with the United Mineworkers, and some or all Patriot employees lose their jobs. Wherefore, the DIP Lenders respectfully request that the Court overrule the objections to and confirm the Plan.”

Read more Patriot Coal bankruptcy news.