Peabody Energy Corporation (BTU)

[LouisDesyjr]

Bowie deal, A/R Agreement, and 90 day deadline

1: 8K for Bowie Deal extension, filed March 31, 2016:
http://www.sec.gov/Archives/edgar/data/1064728/000106472816000171/peabodyenergy-8xk033016.htm

The deal has been extended, but now may include 'non-cash' as part of the deal.

I do not think this is going to help at all. Even if Bowie wanted and could still do the deal, they probably could get a much lower price by waiting to buy the assets in bankruptcy, even if they end up paying a termination fee.

There is another problem in that even if a deal gets done, it looks like something else besides cash would be used to pay for it. This does not help BTU since they need cash to keep operating.


2: 8K from announcement about charges to a receivables backed credit line:
http://www.sec.gov/Archives/edgar/data/1064728/000106472816000169/peabodyenergy8-kmarch2016.htm

Peabody Energy Takes Steps to Avoid Bankruptcy Filing:
http://realmoney.thestreet.com/articles/03/31/2016/peabody-energy-takes-steps-avoid-bankruptcy-filing?puc=yahoo&cm_ven=YAHOO

While it was extended for two years, the maximum amount was reduced from $275 million to $180 million. There are already $170 million in letters of credit open against it, so most of it has been used already.


3: There has been no mention on what is going on with the 90 day deadline from Dec 31, 2015 that was triggered by the going concern language in the 10K report. At this point I expect there will be some kind of waiver or extension announced tomorrow morning with the filing of a 8K report.


Louis J. Desy Jr.


Disclosure: I own put options on BTU.