Patriot Coal Falls More than 60% on Bankruptcy Report
Bloomberg is reporting that Patriot Coal (NYSE: PCX) could file bankruptcy as early as today. The report says that the company "has lined up financing ahead of a bankruptcy filing that may come as soon as today," citing two people familiar with the situation. The financing would take the form of debtor-in-possession financing and is being provided by Citigroup (NYSE: C), Barclays (NYSE: BCS) and Bank of America (NYSE: BAC) according to the report.
Patriot Coal shares have fallen more than 90% in 2012 as bankruptcy fears have enveloped the company. The coal industry has been hit by tens of millions of tons of production cutbacks this year and coal use hit its lowest levels since 1988 in the first quarter. In May, Patriot disclosed that it had hired the Blackstone Group (NYSE: BX) in order to work with lenders to refinance $625 million in loans and credit facilities.
Shares of other coal producers such as James River Coal (NASDAQ: JRCC), Alpha Natural Resources (NYSE: ANR), and Arch Coal (NYSE: ACI) are also falling on the news. PCX was down around 66% to $0.73 on the day.
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