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| UK's largest coal producer 'seeks voluntary liquidation' | UK's largest coal producer 'seeks voluntary liquidation' |
| (35 minutes later) | |
| Britain's largest producer of coal, UK Coal Operations, is understood to be seeking voluntary liquidation after a devastating fire closed its Daw Mill colliery. | |
| The company announced the closure of Daw Mill in north Warwickshire with the loss of 650 jobs in March after the worst coal-mining fire in 30 years. | |
| The fire at Daw Mill was the latest blow to the industry following Hargreaves Services's decision last year to mothball the Maltby mine near Rotherham with the loss of 500 jobs. | |
| UK Coal Operations is now seeking voluntary liquidation to avoid being forced into insolvency, the Financial Times reported on Tuesday. The company had lost £100m of equipment, £160m of coal and incurred £35m in costs, making further restructuring inevitable, Andrew Mackintosh of UK Coal Operations told the paper. | UK Coal Operations is now seeking voluntary liquidation to avoid being forced into insolvency, the Financial Times reported on Tuesday. The company had lost £100m of equipment, £160m of coal and incurred £35m in costs, making further restructuring inevitable, Andrew Mackintosh of UK Coal Operations told the paper. |
| "We are doing everything we can do to save 2,000 jobs and maximise the returns to creditors," he said. | "We are doing everything we can do to save 2,000 jobs and maximise the returns to creditors," he said. |
| Voluntary liquidation would allow a subsidiary to run the firm's surviving mines, which include some of the UK's last deep mines – Kellingsley in North Yorkshire and Thoresby in Nottinghamshire – as well as six open-cast mines in north and central England. Creditors would receive an estimated 32p in the pound if the company went into voluntary liquidation, but just 3p in the pound if it was forced into insolvency, according to company estimates seen by the FT. | |
| In a statement, Kevin McCullough, chief executive of UK Coal Mine Holdings, did not deny plans for voluntary liquidation. | In a statement, Kevin McCullough, chief executive of UK Coal Mine Holdings, did not deny plans for voluntary liquidation. |
| "Our main focus has been on preserving 2,000 jobs and securing the future of UK coal mining. Our remaining mines have been performing well since the fire at Daw Mill and we continue to work closely with our employees, government, pension funds, the Pensions Regulator, suppliers and customers. We remain positive that we have an underlying profitable business." | "Our main focus has been on preserving 2,000 jobs and securing the future of UK coal mining. Our remaining mines have been performing well since the fire at Daw Mill and we continue to work closely with our employees, government, pension funds, the Pensions Regulator, suppliers and customers. We remain positive that we have an underlying profitable business." |
| "There will undoubtedly be some difficult decisions as we have had to look at all possible options, but there is a good business here with 2,000 families depending on our workforce and I am confident we will be able to announce more news in the coming days." | "There will undoubtedly be some difficult decisions as we have had to look at all possible options, but there is a good business here with 2,000 families depending on our workforce and I am confident we will be able to announce more news in the coming days." |
| UK Coal Operation's deep and surface mines yield 7.3m tonnes of coal a year, providing 5% of the UK's electricity. Energy generators that prepaid for coal, including EDF and Eon, would be the biggest losers from liquidation. | UK Coal Operation's deep and surface mines yield 7.3m tonnes of coal a year, providing 5% of the UK's electricity. Energy generators that prepaid for coal, including EDF and Eon, would be the biggest losers from liquidation. |