Tuesday, December 8, 2015

Arch Coal Bond Update

Update on ACI bond 7.25% due 10/1/2020.
There was a re-organization issue so the CUSIP has changed to 039380AC4.

Qualified institutional investors had a chance to do a swap but I believe that fell apart. Currently, the individual investor still owns the full face value which is trading at about $2.00.

The 10/1/2015 interest payment was made and the bond is not considered to be in default. Theoretically, principal could be returned in 2020 but it is dicey due to the heavy debt load that the issuer Arch Coal carries. We will have to wait for the next expected interest payment of 4/1/2016 to see if they have the cash to pay their interest payment.