UK Coal holds crucial talks with creditors

UK Coal, Britain’s largest coal miner, said yesterday it was in talks with creditors to stay solvent and save up to 2,000 jobs after a fire forced the company’s largest mine to close in February.

The miner warned in February that the fire at Daw Mill could harm the viability of the whole company unless it got outside help from government or creditors.

“We remain positive that we have an underlying profitable business,” the company, part-owned by Coalfield Resources, said after the Financial Times reported it had proposed a voluntary liquidation and the handing over of its remaining mines to a new company.

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“I hope we are close to securing a way forward for our remaining mines. There will undoubtedly be some difficult decisions as we have had to look at all possible options,” chief executive Kevin McCullough added.

Officials are working closely with employees, government, pension funds, the Pensions Regulator, suppliers and customers to try and preserve the 2,000 remaining jobs at the coal producer’s mines, the statement said. The Financial Times said UK Coal’s proposal would mean creditors would receive 32p for every £1 of debt. The company declined to confirm it had made any kind of firm offer to creditors.

According to the FT, the principal losers would be four power generators who had prepaid for coal production: EDF, Drax, SSE and E.ON.

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