Murray Energy Corp. received no qualified offers competing against an initial stalking horse bid for substantially all of the company's assets, according to a court filing.
The final deadline for bids on the assets was March 16, but with no qualified bidders, the company canceled a bankruptcy auction scheduled for March 26. Given there were no higher bids, Murray Energy designated a stalking horse offer from a new group formed by its superpriority lenders as the winning bid.
The company owns coal mines across Appalachia and in the Uinta Basin, Illinois Basin and Colombia. Previous bankruptcy filings show that Murray Energy engaged an investment bank advising firm in the summer of 2019 to explore financial options for the company, including potential asset sales. Those efforts were unsuccessful.
Under the company's restructuring support agreement announced in October 2019, the lenders would credit bid the company's debt, and substantially all of the company's prepetition funded debt would be eliminated. The agreement also provides that Murray Energy founder Robert Murray would be named chairman of the board of the new company. Murray President and CEO Robert Moore would maintain his current role in the new organization.
The approved bidding procedures included a provision requiring a bid increment of at least $1.0 million. The bidding procedures also required that any proposals to purchase the assets provide cash consideration sufficient to pay the unpaid principal, interest, fees, expenses and other costs under or on account of the company's debtor-in-possession financing facility.
Murray Energy, which primarily produces thermal coal for U.S. power generators, is restructuring its business through proceedings in the U.S. Bankruptcy Court for the Southern District of Ohio. There is a May 26 deadline for interested parties to object to the sale.
Murray Energy's metallurgical coal subsidiary is undergoing a separate bankruptcy auction process. The subsidiary was not part of the parent company's late-2019 bankruptcy petition but filed its own in February.