James River Coal Company

Client

James River Coal Company is a large coal mining company with operations primarily located in the Eastern United States and approximately 1,400 employees. Pre-petition annual revenues totaled $200 million.

Challenge

Due to over-leverage and declining coal prices, the Company was forced to file for bankruptcy court protection. Bridge was engaged by the Official Committee of Unsecured Creditors (“the Committee”) to assist in determining strategies to maximize their potential return.

Solution

Working with the Committee and their legal advisors, Bridge analyzed potential causes of action associated with prior transactions. Bridge also monitored the Company’s operating performance and advised the Committee regarding the Debtor’s strategies for selling the Company.

Results

The Company confirmed a plan of reorganization in which the unsecured creditors received proceeds sufficient to pursue litigation with potentially significant returns and to pursue a refund under the Coal Act of 1992. The Trust has benefited from work done by its professionals to lobby for passage by the Congress in 2007 of the Coal Act Refund on behalf of James River as a member of The Coal Act Fairness Alliance (“CAFA”). This has contributed $14 million towards the creditors’ recovery. The litigation effort continues and Bridge anticipates additional recoveries from the resolution of a lawsuit being prosecuted against former directors and officers of the company for failure to properly adhere to their fiduciary duties.