Judge Charles Rendlen said March 1 that, in exchange for the loan, Wilmington Trust, head of a group of Arch’s secured lenders, will hold nearly all equity in the new company.
The loan will be used for operational expenses during its bankruptcy case, and $75 million has been earmarked for reclamation costs tied to a deal between Arch and state regulators in Wyoming.
Some smaller lenders had opposed the financing request, arguing that the producer had enough money to continue operations during its Chapter 11, and environmentalists had opposed the dollar amount decided upon in the reclamation agreement.
Rendlen, however, commented otherwise in his decision, according to Debtwire.
“We’re here, we’re moving fast, we have a good company,” he said. “The last thing a judge needs to do is get in the way of a company moving forward.”
Arch has been anticipating completing its restructuring by this fall, a process that company spokeswoman Logan Bonacorsi said is ongoing and still on target.
“We believe we have the essential components in place and intend to emerge a stronger and more competitive company,” she said.
Arch, owner of the Black Thunder and Coal Creek complexes in the Powder River Basin as well as nine other mines, initially filed for bankruptcy protection in January.
