TURNAROUND firm Better Capital insisted it stands ready to invest around £15m in embattled coal miner ATH Resources, despite putting its parent company into administration.
Administrators for KPMG are trying to find a buyer for the Doncaster-based firm, which mines from four opencast pits in Scotland, after Jon Moulton’s private equity firm called time on its debt.
Better Capital (BC) last month bought ATH’s £15m debt owed to HSBC and Yorkshire Bank.
On Wednesday BC demanded immediate payment of the debt, forcing ATH Resources plc into administration. Its shares were suspended. Its main trading subsidiary Aardvark TMC continues to trade normally as the administration only affects the plc.
BC chief executive Mark Aldridge said the administration was to “get control of the process” so there are “fewer parties”. He said BC is trying to persuade local councils, landowners, the Coal Authority and environmental bodies to accept lower rewards and be “more flexible” on planning and restoration, in return for its investment in the business.
“The whole intention here is to create a stable platform going forward,” said Mr Aldridge.
“BC has additional cash set aside – £15m – to invest in an ongoing trading business. It can work if it’s done in a different way.
“Let’s come to the table and make it work.”
ATH employs about 320 staff including around 40 in Doncaster.
Chairman David Port said: “It leaves me feeling pretty sad because I’ve worked in this business for 14-15 years. Hopefully it’s going to come out of the other side a lot stronger and a lot better.”
Joint administrator Will Wright said: “We are now looking at all the options, including a sale of the business, working with the directors and the other key stakeholders to try and find a solution that sees trading of the parent company continue.”
Better Capital has first call on proceeds from a sale of ATH.
A Scottish Government spokeswoman said: “The Scottish Government remains committed to working with all parties to secure the best possible outcome for all those involved with ATH, including its existing employees and the local areas in which the company operates throughout Scotland.
“ATH has written to its employees to appraise them of the situation and the Scottish Government will continue to work closely with its public partners and with ATH to support and facilitate on-going discussions between all parties to achieve a positive solution”.