Peabody Energy Corporation (BTU)

[LouisDesyjr]

The subsidiaries and the common

I think you are confusing common stock equity (shareholder equity on the balance sheet) with assets. The two are different things.

The subsidiaries are part of the assets of BTUUQ in the bankruptcy estate. At some point, once the plan is announced and put into effect, those assets would either still belong to the existing shareholders or 'new' shareholders in the reformed company (the 'new' issued common shares) would be distributed to the different classes of liabilities in the bankruptcy estate in order of priority.

So while the subsidiaries may not themselves file bankruptcy, they are assets that will someone get distributed to the liabilities when the company is reformed.

I am expecting that the credit line and bonds will get all of the new common shares in the reformed company, part of which will include the subsidiaries; and the existing common shares will be cancelled (or get warrants that are virtually worthless).

Louis J. Desy Jr.