Fitch Places Peabody Energy Corp on Rating Watch Negative.NEW YORK New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of -- Fitch has placed the Issuer Default Rating (IDR IDR In currencies, this is the abbreviation for the Indonesian Rupiah. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. ) and debt ratings of Peabody Energy Corporation (Peabody) on Rating Watch Negative following the announcement it has agreed to purchase Excel Coal Limited. The ratings placed on Negative Watch are: --Issuer Default Rating (IDR) 'BBB-'; --Senior Unsecured Notes and Debentures at 'BBB-'; --Secured Bank Term Loan at 'BBB'; --Secured Bank Revolving Credit Revolving Credit A line of credit where the customer pays a commitment fee and is then allowed to use the funds when they are needed. It is usually used for operating purposes, fluctuating each month depending on the customers current cash flow needs. Facility at 'BBB'. On July 5, 2006, Peabody announced an agreement to acquire Excel Coal Limited for a total acquisition price of approximately $1.34 billion plus assumed debt of approximately $190 million. The transaction is to be an all cash deal and be debt financed at least initially. The financing will double Peabody's current debt load and increase Total Debt/Operating EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become from 2 times (x) to about 3x pro forma for 2005. The transaction is subject to customary regulatory and shareholder approvals and is expected to close early in the fourth quarter of 2006. Fitch's rating definitions and the terms of use Terms of Use are rules set up by the owner of an intellectual property or service to govern how they may be legally used. In many cases, terms of service are used as a contractual agreement between a company and users of a service they provide. of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures Policies and Procedures are a set of documents that describe an organization's policies for operation and the procedures necessary to fulfill the policies. They are often initiated because of some external requirement, such as environmental compliance or other governmental are also available from the 'Code of Conduct' section of this site. |
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