James River Coal Co. said it has selected JR Acquisition, a subsidiary of Blackhawk Mining, as the successful bidder for certain of its assets for an aggregate purchase price of $52 million, plus assumption of certain liabilities.
According to an Aug. 21 notice of the selection of the bidder filed with the bankruptcy court in Richmond, Va., the purchased assets include those assets known as the Hampden Complex (including the assets of debtor Logan & Kanawha Coal Company); the Hazard Complex (other than the assets of debtor Laurel Mountain Resources; and the Triad Complex.
A hearing to approve the sale is scheduled for tomorrow.
As reported, the auction for the company’s assets was initially set for July 8, but was delayed five times, finally occurring on April 18 and, according to court filings, lasting through Aug. 20. According to court filings, Blackhawk Mining was disclosed as the stalking-horse bidder for the auction on Aug. 16, just two days before it got underway, with an aggregate purchase-price bid of $50 million, plus the assumption of certain liabilities.
Proceeds are to be used to pay certain expenses now facing the company and to repay existing outstanding DIP loans. There is roughly $90 million outstanding under the facility, according to the company’s July 30 operating report filed with the bankruptcy court.
According to its website, Blackhawk Mining was formed in 2010 to acquire and operate idled coal reserves, mines, preparation-plant and loading facilities formerly owned by Black Diamond Mining in Floyd County, Ky. Among other things, Blackhawk operates a combination of underground continuous miner sections and contour-surface mines, with a high-wall miner in the Elkhorn and Fireclay, Ky., coal seams, with production processed through a preparation plant and train-loading facility at Spurlock, Ky. – Alan Zimmerman