* To enter into a $110 mln debtor-in-possession financing
* To continue evaluating alternatives such as sale of one or
* Shares slump 41 pct in extended trading
(Adds details from statement, background and shares)
April 7 James River Coal Co filed for
Chapter 11 bankruptcy protection after struggling with a steep
drop in prices and demand for both thermal and steel-making
James River shares plunged 41 percent to 42 cents in
extended trading on Monday.
"The coal markets in the U.S. have changed dramatically
during the past several years," Chief Executive Peter Socha said
in a statement.
U.S. power companies have switched to cheaper natural gas,
depressing thermal coal prices, while weak steel demand and
excess supplies have weighed on metallurgical coal.
Coal companies have also been hit by President Barack
Obama's push for stricter regulation of greenhouse gas emissions
by the Environmental Protection Agency.
U.S. miner Patriot Coal Corp declared bankruptcy in July
2012 and exited the restructuring process in December.
James River and its units filed voluntary petitions for
reorganization under Chapter 11 in the bankruptcy court for the
Eastern District of Virginia Richmond.
The company also said it would enter into a $110 million
debtor-in-possession financing facility with several large
James River, which expects to continue its mining operations
and customer shipments through the restructuring process, said
it would use the new funding to support its business on approval
by the bankruptcy court.
The company also said it would continue to evaluate
potential alternatives such as a capital investment through a
plan of reorganization or a sale of one or more parts.
James River shares, which traded above $60 in June 2008,
closed at 71 cents on the Nasdaq.
(Reporting by Swetha Gopinath in Bangalore; Editing by Sriraj