Walter Energy Inc. is preparing to file for bankruptcy protection this week after agreeing on a fast-track restructuring process that would hand ownership of the coal miner to senior creditors, the Wall Street Journal reported today. The company, which has been battered by a sharp drop in coal prices, plans to swap its senior creditors’ debt for ownership of the company in a chapter 11 restructuring that would largely wipe out junior creditors and reduce labor and pension costs. Walter and a group of senior bond and loan holders yesterday were finalizing an agreement that would allow the company to use cash pledged as collateral to fund its operations in bankruptcy. Walter had $434.7 million in cash as of March 31, according to a regulatory filing.
