New Zealand bails out stricken coal miner
The government of New Zealand said it would pump up to NZD155 million into a stricken coal miner in the country. NZ government would rescue Solid Energy along with private lenders that would swap some debt for equity. The plan was to save the stricken coal miner which was also slated for a partial privatization.
Under the proposed restructuring plan, the state owned miner would issue NZD100 million of redeemable preference shares. Meanwhile, key lenders would exchange NZD75 million of debt for equity. The New Zealand government would inject NZD25 million.
The government would also give Solid Energy NZD130 million in working capital and reserves. This would be payable in three years, said Finance Minister Bill English in a statement. He also added that the plan would be confirmed by the end of the month.
Solid Energy's main lenders included New Zealand bank and Australian based banks. Westpac Banking Corp, ASB Bank, Australia and New Zealand Banking Group Ltd. and the Bank of New Zealand were the main lenders of the troubled coal miner. Meanwhile, TSB Bank disclosed that it is a bond holder in the company.