Peabody Energy granted interim access to $500 million of DIP financing

By Caroline Salls

Pittsburgh, April 14 – Peabody Energy Corp. obtained interim court approval to use $500 million of a proposed $800 million of debtor-in-possession financing, according to an order filed Thursday with the U.S. Bankruptcy Court for the Eastern District of Missouri.

The final hearing is scheduled for May 5.

The financing was arranged by Citigroup and includes a number of the company’s secured lenders and unsecured noteholders.

The DIP facilities include a $500 million term loan, a $200 million bonding accommodation facility and a cash collateralized $100 million letter-of-credit facility. Under the interim order, Peabody can access $200 million of the term loan, $200 million of the bonding accommodation and $100 million of the letter-of-credit facility.

The DIP financing will mature 12 months from closing, provided that it may, at the election of the company, be extended by up to an additional six months under specified circumstances.

Interest will accrue at the base rate plus 800 basis points for base rate loans and at Libor plus 900 bps for Libor loans.

Peabody, a St. Louis-based coal producer, filed bankruptcy on April 13. The Chapter 11 case number is 16-42529.

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