UK Coal Pursuing Voluntary Liquidation

The Guardian reported that UK Coal plc (OTC Pink:UKCLF), Britain’s largest coal miner, faces an uncertain future in the wake of a fire that closed its largest colliery. The company has reportedly “refused to deny” rumors that in order to avoid enforced liquidation — and a total shutdown of its business — it is pursuing voluntary liquidation.

As quoted in the market news:

UK Coal said this week that it is holding talks “with a wide range of interested parties” over the future of its last two deep mines – Kellingsley in North Yorkshire and Thoresby in Nottinghamshire – as well as six open-cast mines in north and central England.

Voluntary liquidation would allow a subsidiary to run the firm’s surviving mines but could pass on the company’s £540m pension deficit to the UK Pension Protection Fund, which would force losses on some of the company’s 6,800 savers. If UK Coal fell into insolvency the workforce could see 10% of the value wiped off their pensions.

Kevin McCullough, chief executive at UK Coal, commented:

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.

Click here to read the full report from The Guardian.