(Adds UK Coal comment, details, background)
LONDON, June 11 British coal producer Hargreaves
Services has withdrawn a loan offer to rival miner UK
Coal saying it could not agree to a loan plan with other parties
discussing the managed shutdown of UK Coal.
UK Coal, Britain's largest coal producer, went into
administration last year and its business has since deteriorated
further due to competition from cheaper coal producing markets
and the strength of the pound because it is paid in dollars.
Hargreaves Services had been in discussions to provide UK
Coal with a 5 million pound ($8.4 million) loan.
UK Coal, whose two deep coal mines employ around 1,300
people, has been seeking government and private loans to help
wind down its business over the coming 16 months.
"It is with regret that Hargreaves announces today that,
despite the efforts of the stakeholders, it has not been
possible to secure a plan that it is able to support,"
Hargreaves said in a statement.
UK Coal said on Wednesday it was pursuing other options for
its managed closure plan.
"UK Coal will continue to work with government, Harworth
Estates, employees and the trade unions and will provide an
update in the coming days," the company said in a statement.
The government pledged in April to provide UK Coal with a 10
million pound loan to help fund the closure.
Regeneration company Harworth Estates was not immediately
available for comment.
($1 = 0.5956 British Pounds)
(Reporting by Karolin Schaps, Editing by Paul Sandle and Susan