With mounting debt, Arch Coal bond prices plummet

Pavan Vangipuram/Missouri Business Alert.
Pavan Vangipuram/Missouri Business Alert.

Many bond investors are worried that heavily-indebted Arch Coal won’t make it through a coal market downturn that has already gone on longer than many expected. Prices for most of the Creve Coeur-based company’s unsecured corporate bonds have fallen below 50 cents on the dollar in recent weeks as concern mounts that steam coal demand and prices for coal used to make steel won’t rise fast enough over the next few years to save the company from bankruptcy.

Arch is one of a number of coal companies headquartered in the St. Louis region, but its high leverage and exposure to high-cost Appalachian mines and the depressed metallurgical market are hurting it more than others.

Read more from the St. Louis Post-Dispatch

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