On Wednesday, Peabody Energy Corporation (NYSE: BTU) filed for chapter 11 bankruptcy protection from its creditors only weeks after warning that it could do so, the latest in a string of bankruptcies that have ricocheted through the U.S. coal-mining industry. According to a court filing, the company listed liabilities and assets in the range between $10 billion and $50 billion.
Peabody Energy Corporation, the largest U.S. coal mining company, follows on the heels of similar moves by Arch Coal Inc. (OTCMKTS: ACIIQ), Alpha Natural Resources, Inc. (OTCMKTS: ANRZQ), Patriot Coal Corporation (OTCMKTS: PATAQ) and Walter Energy Inc. (OTCMKTS: WLTGQ).
“This was a difficult decision, but it is the right path forward for Peabody,” Glenn Kellow, the company’s president and chief executive, said in a statement. “This process enables us to strengthen liquidity and reduce debt, build upon the significant operational achievements we’ve made in recent years, and lay the foundation for long-term stability and success in the future.”
Peabody was founded in 1883 by Francis Peabody with $100, a wagon and two mules, according to the company’s corporate history. It grew into a juggernaut in the U.S. coal industry, producing coal for customers in 25 countries and employing 7,600 people.
The miner hit particularly hard times after the price for thermal coal used in power stations and metallurgical coal used in steelmaking collapsed last year, leaving the company struggling to pare back its heavy debt burden. Both thermal coal and metallurgical coal prices have fallen to a decade low.
“Through today’s action, we will seek an in-court solution to Peabody’s substantial debt burden amid a historically challenged industry backdrop,” said President and Chief Executive Officer Glenn Kellow.