WalterEnergy Canada Holdings Inc. announced March 31 that it has been granted anextended stay under its Companies' Creditors Arrangement Act "to continueits sale and investment solicitation process for the company's assets."
The extensionruns through June 24.
WalterEnergy Canada is a holding company for the Canadian and U.K. operations ofAlabama-based Walter Energy Inc.
Theextension is not related to the company's U.S. bankruptcy proceedings andapplies only to the sale of its Canadian and U.K. assets. According to thecompany initial sales filing in the Supreme Court of British Columbia, theseinclude the Brule and Willow Creek coal mines near Chetwynd, British Columbia,and the Wolverine coal mine near Tumbler Ridge, British Columbia.
WalterEnergy filed for bankruptcy protection in the U.S. in July 2015 and enteredinto a purchase agreement for its core assets with later that year.The company's noncore assets were sold to affiliates of and the in February.
Whileearlier statements from the company suggested that the asset sale would notinclude Walter's U.K.-based assets, the monitoring report states that theproperty will now be a part of the review process.
Accordingto the report, the deadline for submission of final binding offers in phase twohas been set for May 27 with a closing date to occur by June 30.
Thecompany also announced that it had commenced phase two of the sale andinvestment solicitation process.
Accordingto a monitoring report provided by KPMGInc., phase two will allow qualified bidders to "perform duediligence on the assets and operations of Walter Canada and Walter UK, and itis expected that the data room maintained by the financial advisor will beexpanded to respond to various information requests."
Theacquisition of the company's Canadian assets has been cited as a turning pointin the company's path toward bankruptcy. In April 2011, Walter acquired Canada'sWestern Coal Corp.,creating one of America's largest metallurgical coal producers. A week later,the company's stock price hit an all-time high, allowing some understandableconfidence about the purchase and where it left the company.
Inthe months and years that followed, Walter struggled with an increasinglycommon series of challenges facing U.S. producers, including waning demand andpricing and competition from foreign producers. Together, the company'schallenges cast the costly acquisition, valued at $3.3 billion, in a new,burdensome light.