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so shares go to zero in your opinion?
Material announcement - Plan confirmed by court
Arch Coal restructuring plan wins bankruptcy court approval
The court approved the plan on September 13, 2016. This starts a ten or eight day time period for anyone to file an appeal of the confirmation of the plan. Once that deadline passes, around Friday, Sept 23, 2016; the court will enter an order for the effective date of the plan. At that point it is all over for the existing common shares.
At that instant the stock will be wiped out and trading will be halted, never to restart again. This trading halt could even come in the middle of a trading day, as it has with a few other companies in similar situations.
Unless someone files an appeal of the entry of the plan, the existing common shares will never open for trading on Monday, September 26, 2016.
Louis J. Desy Jr.
when anything material is announced, then it will be the time to make a decision for a confirmed future event...thanks for the advisory of one possibility though meanwhile...no change in plans currently...today was another good day to add imho...
Beware..... And read docket 1101 at prime clerk.
"The holders of interests in Arch Coal shall neither receive any distributions nor retain any property on account thereof pursuant to the plan. All interests in Arch Coal shall be cancelled and extinguished."
They are back in court Sept 13 where they will seek confirmation of the plan. If confirmed it should become effective in approx. two weeks (could be quicker). At that point all trading will cease and holders will get nothing. Final days here for ACIIQ.
Word is going to zero
wonder if coal assets will be worth more under Trunp, sure looks like it
very interesting, can we run to a buck and squeeze shorts to 3 bucks
Looks like sseiq. Is gonna run. It be nice to see some Qs run this month. My gut tells me they will.
Nice! Bidding up. Hmmmm?!?
Took a nibble of this and anrzq. Today. Hoping a Q coal sector can catch a momentum run. Profit or loss though I'm out soon
Very interesting to say the least.
wow whats going on, are assets worth something in bk, is coal alive again
Wouldn't say 'following'...but as far as today goes 'watching with interest'
Is there anyone still following ACIIQ?
Called investor relations and it sounded like the were going to wipe out common shares potentially ....
Has anyone else heard anything....up a couple of pennies past few days.
Case in point about trading stock of a company in bankruptcy.
I made some nice profits trading America West Airlines stock during the time between it filing under Title 11 and the date of stock cancellation. I also made some nice profits from the new stock issued.
Also, for entertainment I track several stocks which have had no business activities for years. I observed one stock that went to over $11 for a company that never had any revenue. Strange? Yes! It happened.
Why trading for $0.30?
One of the reasons is that there was a big run up after the DIP financing was announced. Most of the retail market thinks that meant the company and the existing common shares were 'saved'; when in fact they were now even further away from any recovery for the common shares.
Louis J. Desy Jr.
If stock is going to be canceled, why
is it still trading for .30 cents?
Yes, this was a great trade. But, board has dried up, it's a holiday, markets are closed, take the day off, bash tomorrow....
Arch Coal says the common shares will be cancelled
Investor FAQ from the company web site:
www.archcoal.com/restructuring/pdfs/FINAL%20ACI%20Agreement%20-%20Chapter%2011%20Investor%20FAQ.pdf
The top US Coal companies
enjoy
https://www.eia.gov/coal/annual/pdf/table10.pdf
When Arch Coal filed for Chapter 11 bankruptcy under USC 11 there were three related entities that so filed. Following are their names and case numbers
Arch Coal, Inc. 4:16-bk-40120
Arch Coal West, LLC 4:16-bk-40126
Arch Coal Sales Company, Inc. 4:16-bk-40136
A good question for which to seek and answer is how long the Arch Coal Inc bankruptcy will take to conclude.
What!
Trapped quite a few. Need to lower another 30-40% to shake off
$2-4 price target Earnings Feb 2nd
Bitcoin had same float went from pennies to $1000 plus dollars
Low float determines short squeeze and naked short squeeze momentum regardless of anything fundamental. Concerning Buying pressure can take over very quickly.
LoL. The entire market has become a 'day trade'. There's nothing left I consider an 'honest investment'. Prudent to take profits off the table when and where you can. Always did like the Muppet Show when younger.
ANRZQ is almost as bad off as ACIIQ
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=119994803
I think that while ANRZQ is not as bad as ACIIQ, it is still bad.
I expect that ANRZQ may have to stop operations even after the reorganization since it looks like they will lose about $20 million per month, even without any debt.
While they look better than ACIIQ, they are not good either.
Both ACIIQ and ANRZQ are very ill financially, it is just that ACIIQ is 'more ill'. Even with the Chapter 11 filings, I expect neither will be able to recover until coal prices go back up; plus since ANRZQ filed for bankruptcy a little ahead of ACIIQ, I expect their stock will get wiped out first since they are further along on the timeline.
Louis J. Desy Jr.
But you think highly of ANRZQ?
Trade verse long term
I do not object to anyone doing a trade, as long as people understand that they are talking from the
I have thought about that, but consider it too risky since it is possible the muppets will not pile in enough to move the stock price.
The problem is that many other people may not understand that.
Louis J. Desy Jr.
AAMRQ was a unique situation, not the same as ACIIQ
Normally, just based on the financials going into the filing, I would have agreed that AAMRQ was going to be worth nothing, but anyone following the process would have seen and realized that the problem was costs and it could be fixed. What is different about AAMRQ from ACIIQ, that is not present in this situation, is that AAMRQ was able to present a plan that would pay all other classes off in full over time. This was possible because AAMRQ used the bankruptcy process to reduce their labor costs and breaking any other contract that was causing the losses.
In the situation with ACIIQ, there is no way to restructure costs so the company is profitable. The main problem is that coal prices are too low, partly because of the large drop in natural gas and oil prices.
Here that is not possible to lower costs enough. Even after the bankruptcy ACIIQ is probably going to still be losing all kinds of money and has no hope of ever being able to make all of the liabilities whole.
I found a PDF case study that discusses how it was possible for AAMRQ at:
https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=5&cad=rja&uact=8&ved=0ahUKEwi_3MDag8jKAhWCgj4KHVZfDD4QFgg-MAQ&url=https%3A%2F%2Fturnaround.org%2Fcmaextras%2FCarl-Marks-Competition-American-Airlines.pdf&usg=AFQjCNGtuGF6n8XYusxi2lGyYW5zVawKfA
( Google search term 'american airlines bankruptcy' )
If you look at the chart on page 9 of the PDF, you will see that all classes are 'Full Recovery' or '100% recovery'. The classes listed as 'Impaired' are only impaired because they would not be getting their money on the original terms, but they would still get 100% over time.
Some selected quotes from the case study:
Ouch!
Classic Uncle SOROS
You remind me of Albert on aamrq said every day stock to zero
Bonds getting shares.
While some of the bonds will get shares, I do not expect it will not make them whole. I expect some of the more junior series of bonds are going to be wiped out also.
Even the ones that do get shares, I expect they will suffer large losses also.
Louis J. Desy Jr.
You're manipulating the numbers to fit your agenda and not taking into account what effect restructuring may have, insider holdings, and the mere fact that the vast majority of liabilities are long term, renegotiable, and not due tomorrow. Also, you're ignoring the fact that I don't care about the company, just a trade, a very good trade for many, that was facilitated by what the market perceived as a beneficial development related to the DIP.
You forgot one. Thing bond people may get shares:)
Guess you work for avenue capital kind
DIP was very good news? No it wasn't
You are either being disingenuous (i.e. you know the DIP does not help the common shares but want to stock to rise to play off of the mistake the muppets are making) or you do not understand that the DIP has super priority, making it harder for the existing common shares to survive the bankruptcy.
Prior to the DIP financing, the common shares are hundreds of millions of dollars 'in the hole'.
In a prior message at: http://investorshub.advfn.com/boards/read_msg.aspx?message_id=120009551, I detail how bad off the bonds are. If the situation was better and the common shares going to recover, the bonds would be trading much higher. If someone really thought the common shares were going to survive, they would be better off buying bonds since the bonds are higher in priority and would have large profits if they were made whole. The problem is that this is NOT going to happen. A number of the bonds series are going to suffer large losses and a few classes might even get wiped out. The common shares which are lower will also be wiped out.
Looking at the latest 10Q report, we can estimate what the order of priority will be for the classes in the bankruptcy. (Later when the filings are posted, we can see the total classes and what is in each, but for our purpose of seeing if the common will recover anything this will be good enough for now)
10Q report for period ending Sept 30, 2015:
http://ih.advfn.com/p.php?pid=nmona&article=69225417
The report lists a total of $5.8 billion in assets. Against that are liabilities of $6.4 billion. The common shares will only recover anything only if all other classes (liabilities) are made whole. This is not possible since liabilities exceed assets by over $600 million;therefore
THE COMMON SHARES ARE DEAD!
In the months since 09-30-2015 the company probably lost another $400 million, since it seems on average to be losing that in the quarters prior to the filing; so adding the $400 million loss onto the $6.4 billion in liabilities brings total liabilities to $6.8 billion.
On top of that, the DIP financing is for $575 million. This has a super priority in the bankruptcy in that it has priority over most of the bonds and adds to liabilities, bring total liabilities from $6.8 billion to $7.375 billion. While the DIP draw down will also add cash in the same amount as it is drawn, it will probably be more than offset by losses recognized on assets as they are written down by asset sales but lets assume for a moment there are no asset write downs; so assets will go from $5.8 billion to $6.375 billion.
So what do we have after the DIP financing and
NO asset write downs:
Assets: $6.375 billion
Liabilities: $7.375 billion
Result: There is not enough assets to pay off or make whole all of the liabilities since liabilities exceed assets by one billion dollars.
While a Chapter 11 plan can propose to pay off the difference over time after reorganization, this seems impossible since the company is losing hundreds of millions of dollars per quarter;i.e. operations will still be losing money so there is no way to propose to pay off everything in the future.
What does this all mean?
IT MEANS THE COMMON SHARES ARE DEAD!
Anyone proposing that the common shares are somehow going to survive the bankruptcy is either being disingenuous or simply does not understand the process and what the numbers are for the company and how bad off the company is.
Louis J. Desy Jr.
Yes, the DIP was very good news and the muppets were very wise to trade and bring the ticker to a 52 week high. Whether or not common shares will survive Chapter 11 remains to be seen, but also irrelevant. OTC is for trading, not investing IMO. 6-700% return in a matter of days or even 60% if you got in late is a pretty good trade IMO. They've got cash, restructured debt, etc, it could turn out OK, but to be honest, I don't really care, just a trade.
Bash away? How do you explain the stock rise?
My contention is that the stock rose because the muppets saw the PR about the DIP financing and think that the common shares are now 'saved', without realizing that the DIP financing has super priority and puts them further away from any recovery.
What is your explanation for the rise in price?
I have the following questions to ask you:
1: Why do you believe the stock price rose in the past two trading sessions?
2: Do you think the common shares will survive the bankruptcty? If yes, why and how do you think that will happen?
3: I have posted about the bankruptcy process and the priority of classes in my prior posts on ACIIQ, do you agree or disagree with the presentation and why?
Louis J. Desy Jr.
Hilarious...dumb and all the richer....bash away...
DIP financing 'move' is over
It is down 12% to $0.68 on 500,000 shares. It looks like all of the muppets have piled in and there is no one else left to buy.
It is probably going to crash now, until the next PR gets the muppets going again.
Louis J. Desy Jr.
Looks set to move out of the gates.
Too many of us price target $1
But I bail here!
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As one of the nation's largest and most efficient coal producers, we contribute roughly 12% of America's coal supply. We have a leading position in all three major low-sulfur coal basins, with mining complexes in Wyoming, Utah, Colorado, West Virginia, Kentucky, and Virginia.
We're proud stewards of safety and the environment, and have amassed dozens of national and state awards for excellence. We're also a recognized leader in technology and innovation with Business Week's Web Smart 50, CIO 100 and InformationWeek 500.
Investments in research and development of clean coal and coal conversion technologies, such as coal to diesel fuel and coal to natural gas, are helping pave the way for greater independence in our energy future... More
An intersection of life. The essence of people, planet and power - with a need to strike a balance between the three. At Arch Coal, we have always balanced our strategy on three key pillars: safety, environmental stewardship and financial performance. Excelling in each of these core values will chart our course and guide our success in the years ahead. Click the pics below:
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This company pays dividends - click the link >>> | > > > | >>>http://investor.archcoal.com/dividend.cfm |
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Canada | 309.6 | 433.63 | 466.38 | 504.48 | 528.13 | 541.25 | 529.95 |
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United States | 2,094.45 | 2,837.08 | 3,163.96 | 3,592.36 | 3,662.03 | 3,810.98 | 3,816.85 |
North America | 2,461.15 | 3,371.59 | 3,753.11 | 4,264.95 | 4,362.82 | 4,543.15 | 4,543.66 |
France | 236.75 | 324.44 | 369.02 | 411.93 | 437.3 | 451.81 | 447.27 |
Germany | - - | - - | 483.48 | 505.04 | 532.5 | 545.76 | 549.06 |
Turkey | 21.84 | 47.84 | 68.39 | 98.57 | 110.43 | 129.01 | 141.46 |
Russia | - - | - - | 714.23 | 717.29 | 745.18 | 779.44 | 819.59 |
South Africa | 85.52 | 144.71 | 161.69 | 180.73 | 199.85 | 211.19 | 201.88 |
China | 261.49 | 549.34 | 876.43 | 1,177.89 | 1,678.77 | 2,195.10 | 2,528.95 |
India | 97.9 | 219.88 | 318.28 | 375.39 | 428.18 | 483.29 | 517.21 |
Japan | 523.72 | 776.49 | 896.62 | 946.3 | 936.6 | 979.82 | 982.46 |
The US has been generating over 49% of its electricity from coal for decades now and despite all the noise, we do not think this figure is going to change substantially soon. From 1980 to 2006, US electricity consumption has increased by 89%, which means that coal consumption increased by a similar magnitude, for the percentage of electricity generated from coal has remained somewhat steady throughout the years. The idea that solar, wind and other sources can immediately replace coal is a fallacy; it would take years for us to replace coal plants with a mixture of nuclear, solar and wind power plants. This would not address future demand and so bottom line, while coal is dirty, it is here to stay for years to come.
The two main players now are China and India; china now consumes more coal now than any other country in the world; to put this in perspective, China now consumes more coal than US and the Entire European union combined. Last year China consumed 2.62 billion tons, an increase of over 160% from 2000, when it consumed only 1 billion tons. By 2010, it is estimated that China will use approximately 3 billion tons; currently, China alone consumes roughly 1/3 of the worlds total coal output. Roughly, 70% of China’s electricity is generated from Coal (1.93 trillion kilowatts), and it is still constructing roughly one new coal power plant a week. Even Though China has embarked on one of the most aggressive nuclear power plants building sprees ever, when all these plants are built, they will barely supply 5% of Chinas total electricity needs. Thus it’s fairly easy to assume that coal will remain a major driving force of the Chinese economy for decades to come.
India is the 6th largest generator of electricity in the world, and it’s also ranked as the 6th largest consumer worldwide. Over the past decade consumption has increased by over 64% and its projected increase in electricity consumption of 8-10% annually is one of the highest in the world. As with China and the United States, coal provides a major portion of India’s electricity; currently, 69% of India’s electricity is generated from coal.
In 1996 India consumed 295 million tons of coal; by 2005 the figure had jumped to over 465 million tons. From 2000 to 2005 India’s coal usage increased by 5.5% a year; if we use the same projection, then in 2006 it consumed 490 million tons, in 2007 it consumed 516 million tons, in 2008 it consumed 544 million tons and by 2011 it will be consuming roughly 637 million tons; this off course is based on the assumption that consumption will continue to increase at a pace of 5.5% per annum and not spiral upwards.
The EIA Projects that India and China will account for 34% of the world’s total increase in energy consumption worldwide and 85% of the world’s total projected increase in coal usage between 1995 and 2020. China and India have increased their power output by 1000% and 500% respectively since 1980 and at the rate China is going; it will eventually surpass the United States. The only way it’s going to be able to increase its output in a significant way it’s to embrace every single source of energy out there and that includes coal.
These two countries are already operating well below optimal capacity; in fact, rolling black outs are the norm in both these countries and thus the question does not fall into the” if” category but the must category when it comes to the construction of new power plants. No matter how aggressively they build new nuclear, solar, or hydroelectric plants, they will still need to continue building coal fired plants in order to meet demand, which continues to increase at a record pace.
Hence even if by some miracle the U.S. could implement some plan in record time that would cut down the need for new coal plants, it would in no way affect long term prices because most of the world’s electricity is still derived from coal.
There are several ways to play this sector, some more rewarding than the others, but the simplest way if you are bullish, would be to purchase shares in KOL, the coal ETF. As market conditions are currently far from normal, individuals should refrain from taking huge bites, but instead deploy their money in bits and pieces. Finally, one needs to take the long term view, for the short term ride is bound to be volatile.
Copyright © 2009 Sol Palha
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Sol Palha | Tactical Investor | 38-11 Ditmars Blvd. Astoria, NY, 11105 | Email | Website
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