A coal-mining giant has filed for Chapter 11 bankruptcy protection amid an industrywide slump.
Peabody Energy — which is the biggest coal miner in the U.S. and says it is the largest private-sector coal company in the world — is looking to restructure its heavy debt load and gain relief from its creditors. It hopes to continue operations unimpeded.
The St. Louis-based company said in a statement that the pressure on the coal industry is "unprecedented." It cited a drop in prices, weaker demand from China, the rise of competition from fracking and "ongoing regulatory challenges" as reasons for the restructuring.
Earlier this year, Arch Coal — the second-largest coal miner in the U.S. — filed for bankruptcy. Bloomberg noted that three other major coal miners went bankrupt the year before that, and many industry watchers had expected Peabody to follow suit.
Dashed dreams of China-powered prosperity contributed to the coal giant's financial woes. Peabody bought Australian mining firm MacArthur in 2011 for nearly $5 billion. It was a bet on Asian growth, planned at a time when coal prices had been on the rise for two years.