Blackjewel has petitioned for reorganization under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of West Virginia.
Blackjewel expects its mining operations and customer shipments to continue in the ordinary course throughout the court-supervised process.
According to documents filed with the court, Clearwater Investment Holdings, which is secured by a junior lien on the collateral subject to the Riverstone Agreement, has agreed to provide a $20 million DIP facility in the form of a term loan.
“Today’s announcement represents another significant step in our continued efforts to position the company for long-term success,” said Jeff Hoops, Blackjewel’s founder and CEO. “After carefully evaluating our options, we determined that the best way to solidify our financial position and strengthen our balance sheet was to proceed with a comprehensive financial restructuring under court protection. We are confident that this restructuring will solidify Blackjewel’s position as a significant participant in the US coal market.”
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Hoops added “the company has arranged post-petition financing which is subject to court approval. Accordingly, no assurance can be given that a reorganization under Chapter 11 will be successful. If approved, the new DIP financing and cash generated from Blackjewel’s ongoing operations is expected to provide the liquidity necessary to support the business during the reorganization process and allow the company to continue operations and customer shipments in an uninterrupted manner during the court-supervised process.”
Squire Patton Boggs is serving as legal advisor to Blackjewel, FTI Consulting has been retained as chief restructuring officer and financial advisor. Jefferies is serving as the company’s investment banker.
U.S.-based Blackjewel is a coal producer supporting both the global steel and power generation industries.
