Peabody Energy Corp.OTCPK - Current
Peabody Energy Bonds Offer Investors 50% To 75% Upside
Courage & Conviction Investing • 196 Comments
Courage & Conviction Investing • 196 Comments
Peabody Is My Favorite Idea That Everyone Knows, But That No One Understands
William Koldus, CFA, CAIA • 217 Comments
William Koldus, CFA, CAIA • 217 Comments
Mon, Oct. 24, 3:47 PM
- Peabody Energy (OTCPK:BTUUQ +69.7%) skyrockets after Mangrove Partners Fund reports a 5.2% stake in the company, saying it is in the process of retaining legal and financial advisors to assist BTU in seeking the formation of an official equity committee and to preserve and realize on the "substantial value" of the company's shares.
- The latest surge comes after shares already had tripled last week, the apparent result of several news items: a 2.5x price increase in coking coal in Australia to $230/ton since July, a negotiated Oct.-Dec. contract price by Indian steel producers for met coal of $200/ton vs. $93/ton during July-Sept., another extension for BTU to file a reorganization plan until Dec. 14, and probably a short squeeze.
Wed, Oct. 12, 11:12 AM
- Peabody Energy (OTCPK:BTUUQ +1.8%) and Japan's Nippon Steel have set the Q4 contract benchmark for metallurgical coal at $200/metric ton, more than twice the Q3 price, Reuters reports.
- The big jump underscores a resurgence in Asia's appetite for coal that also has been reflected in a recent mark-up in spot cargoes.
- The deal with BTU marks a departure from the normal quarterly price-setting mechanism where Nippon and Anglo American (OTCPK:AAUKF, OTCPK:AAUKY) typically establish the benchmark.
- ETF: KOL
Mon, Sep. 12, 5:58 PM
- Arch Coal (OTCPK:ACIIQ) agrees to set aside collateral to cover future mine cleanup costs as part of its bankruptcy reorganization plan, ending its use of self-bonding, which exempts companies from posting bonds or other securities to cover the cost of returning mined land to its natural state.
- The coal miner had $485M in self-bonds in Wyoming when it filed for bankruptcy protection in January amid $6B of debt.
- ACI initially resisted replacing its self-bonds, arguing in court filings that providing other forms of guarantees would eat into its liquidity.
- ACI, Peabody Energy (OTCPK:BTUUQ) and Alpha Natural Resources (OTCPK:ANRZQ) had a combined $2.2B in self-bonding liabilities when they filed for bankruptcy over the past 13 months.
Thu, Aug. 18, 9:33 AM
- Peabody Energy (OTCPK:BTUUQ) has received court approval for a bonus plan for its top executives and for several agreements to partially cover over $1B in possible environmental liabilities.
- The agreements, inked with Wyoming, New Mexico and Indiana, would see the states receive $127M, $32M and $17M in cash, respectively, if the company walks away from its mine cleanup obligations while in bankruptcy.
Tue, Aug. 16, 5:27 PM
- The Office of Surface Mining and Reclamation Enforcement announces plans to toughen "out-of-date" rules on self-bonding, the program that allows healthy coal companies (NYSEARCA:KOL) to post promissory notes instead of collateral to guarantee returning disturbed land to its natural setting.
- Among the changes, the regulator proposes modifying self-bonding eligibility standards, diversifying financial assurance options for mine cleanups and ensuring an independent third-party review of self-bonded entities' current and future financial health.
- Peabody Energy (OTCPK:BTUUQ), Alpha Natural Resources (OTCPK:ANRZQ) and Arch Coal (OTCPK:ACIIQ) - three of the four largest U.S. coal companies - have filed for bankruptcy in the past year, with more than $2B in self-bonds for future mine cleanups across several states.
Thu, Aug. 4, 5:48 PM
- Peabody Energy (OTCPK:BTUUQ) has asked a U.S. judge to allow it to pay up to $11.9M in bonuses for six top executives if it meets performance targets and emerges from Chapter 11 bankruptcy protection.
- The incentive package, which includes targets for cleaning up coal pits, would raise the pay for BTU CEO Glenn Kellow to $3.9M from $1M if all targets are met.
- U.S. courts often allow bankrupt companies to make special bonus payments to senior management for meeting performance goals; rival coal producer Alpha Natural Resources (OTCPK:ANRZQ), which emerged from bankruptcy in July, received court approval to pay up to $6.8M after arguing that the incentives were essential to ensuring a successful reorganization.
Wed, Jul. 27, 2:24 PM
- Peabody Energy (OTCPK:BTUUQ) reaches a deal to cover mine clean-up liabilities while in bankruptcy with three U.S. states reaches agreement with states on financial assurances in support of coal mine restoration activities
- Under agreements reached with Wyoming, New Mexico and Indiana, ~15% of BTU's $1.2B self-bonds will be secured by debtor-in-possession financing during its bankruptcy; the deals do not specify whether BTU must replace its self-bonds once it emerges from bankruptcy, as Alpha Natural Resources did in its bankruptcy deal with Wyoming.
- Peabody's agreement must be approved by a federal bankruptcy judge at a hearing in August.
Thu, Jun. 2, 4:58 PM
- Peabody Energy (OTCPK:BTUUQ) is suing Bowie Resource Holdings over the collapse of last year's $358M offer to acquire BTU’s Colorado and New Mexico mines.
- The lawsuit, filed at the U.S. Bankruptcy Court in St. Louis, seeks to collect a $20M termination fee from Bowie, plus interest, costs and expenses.
- The sale was a condition of a bond exchange BTU was hoping to use to restructure its debt outside of bankruptcy court; the company cited the failed sale, along with other factors, as reasons it sought Chapter 11 protection in April.
Wed, May 18, 4:58 PM
- The U.S. is considering whether to reign in the self-bonding subsidy on coal mine cleanup costs and thus shield taxpayers from those liabilities, says the director of the Office of Surface Mining and Reclamation Enforcement.
- Peabody Energy (OTCPK:BTUUQ), Arch Coal (NYSE:ACI) and Alpha Natural Resources (OTCPK:ANRZQ) have gone bankrupt in the last 10 months and left behind ~$3.6B in self-bond liabilities.
- Environmentalists have warned officials that coal-producing states in the west left the self-bonding program open to abuse, and the regulator says it will investigate those concerns.
Wed, May 18, 4:26 AM
- Peabody Energy (OTCPK:BTUUQ) has won final bankruptcy-court approval for an $800M financing package after lenders made concessions to appease creditors.
- Peabody said final approval on the Chapter 11 financial arrangements ensures the company can continue operating as usual while it works through a load of debt that it can't support given the declines in coal demand and prices.
Tue, May 17, 5:27 PM
- Peabody Energy (OTCPK:BTUUQ) says it has obtained final bankruptcy court approval for an $800M financing package after lenders made concessions to appease creditors.
- BTU says final approval ensures that it can continue normal operations while it works through debt levels it cannot support given the declines in coal demand and prices; as of the end of 2015, BTU carried assets worth ~$11B and liabilities of more than $10B.
- BTU’s bankruptcy financing includes a $500M term loan, $200M earmarked to cover environmental obligations and a $100M letter of credit.
Wed, May 11, 8:37 AM
- Peabody Energy (OTCPK:BTUUQ) agrees to sell its interest in undeveloped metallurgical coal reserve tenements in Australia's Bowen Basin for A$104M plus a royalty stream.
- The transactions consist of undeveloped and probable reserves of ~165M metric tons.
- Peabody earlier this year filed for Chapter 11 bankruptcy protection for the majority of its U.S. entities.
Thu, Apr. 14, 2:23 PM
- April defaults for U.S. high yield bonds, headlined by bankruptcy filings from Peabody Energy (NYSE:BTU) and Energy XXI (EXXI -72%) plus a missed payment for Linn Energy (LINE -15.4%), now total $14B, after Q1 defaults came in at $15.7B, according to a report from Fitch Ratings.
- The trailing 12-month rate for junk bond defaults has surged to a two-year high 3.9%, Fitch says - 12% of all energy companies, 23% of E&P companies with EXXI's $2.8B in outstanding debt, and a 70% rate in the coal subsector including BTU's $8.4B debt.
- U.S. crude oil prices have staged a mini-recovery to ~$40/bbl but remain below typical breakeven production costs, so B- or lower-rated E&Ps are struggling in the secondary market, with 57% of those companies bid below $0.50, the ratings agency says.
- Now read Energy XXI: It's just business, nothing personal
Wed, Apr. 13, 3:40 PM
- Today's bankruptcy filing of Peabody Energy (NYSE:BTU) comes after a failed effort earlier this year to use its Australian unit to avoid chapter 11 and restructure out of court, WSJ reports.
- BTU had hoped to avoid a sale of most of its U.S. mining assets by raising new debt that was secured by the Australian subsidiary and another unit unencumbered by company guarantees, but the deal fell apart when BTU failed to complete the sale of its New Mexico and Colorado coal mines.
- The company now intends to redirect its efforts to restructuring its debts in Chapter 11 while riding out the historic coal industry storm; shares have been halted all day.
- Kinder Morgan (KMI -1.2%) is lower after the bankruptcy filing; Simmons analyst Brian Gamble says that while the BTU news is not a surprise, the headline could weigh on KMI since the company had said in January that the magnitude of its remaining exposure to coal was solely with BTU and amounted to ~$30M in total EBITDA.
- Now read Peabody Energy: Post mortem
Wed, Apr. 13, 3:23 AM
- Shares of Peabody Energy (NYSE:BTU) have been suspended after the U.S. coal giant voluntarily filed for Chapter 11.
- "Through this process, the company intends to...position [itself] for long-term success, while continuing to operate under the protection of the court process," the firm said in a statement.
- The bankruptcy comes in the wake of a sharp fall in coal prices that left Peabody unable to service a recent debt-fueled expansion into Australia, however its operations Down Under will not be included in the filings.
Mon, Apr. 4, 5:42 PM