Saw this report this morning. Just some additional info. Not sure if this is positive news since they announced some of this last week, just more details now and a meeting tomorrow on it. I would think this would start to move up now, but so far its staying down. I see a lot of good buying this morning, but still staying low
RLPC: Patriot Coal sets DIP bank meeting
By Billy Cheung
NEW YORK, July 23 (Reuters) - Having received court approval on July 10 for its $802 million debtor-in-possession (DIP) facility on an interim basis, Patriot Coal (PCXCQ:$0.205,0$-0.014,0-6.39%) is launching syndication of the DIP with a bank meeting set for 1:30 p.m. Tuesday. After rescheduling the deal last week, the company will hold the meeting at the Intercontinental New York Barclay.
The DIP facility consists of three components: a $125 million revolver based on a borrowing base of receivables and cash, a $375 million term loan and $302 million in letters of credit. Only the revolver and term loan will be marketed more broadly.
The DIP revolver would be priced at 325bp over Libor with a 1.5 percent Libor floor. Upfront fees have not been announced. The term loan would carry an 800bp spread to Libor with a 1.5 percent Libor floor. No offer price on the loan has been set yet. The DIP facility maturity can be extended to December 31, 2013, but has a 15-month tenor.
The DIP revolver would refinance the $52 million in letters of credit under the company's prepetition securitization facility. The first draw down of the DIP would also repay $25 million in funded borrowings under Patriot's prepetition credit facility. The remainder of the DIP proceeds would be used to rollover prepetition letters of credit and fund Patriot's ongoing business and general liquidity needs in bankruptcy.
Use of the DIP is subject to minimum liquidity, operating earnings and capital expenditure covenants. Citigroup, Barclays, and Bank of America Merrill Lynch are serving as joint lead arrangers for the DIP financing.
Patriot Coal (PCXCQ:$0.205,0$-0.014,0-6.39%) is a leading producer and marketer of thermal and metallurgical coal in the eastern U.S., with 12 active mining complexes consisting of 19 surface and underground mines in the Appalachia and Illinois Basin. The company controls an estimated 1.9 billion tons of proven and probable reserves.
A final hearing on the DIP has been set for August 2. (Editing By Jon Methven)
