The bankruptcy of Walter Energy Inc. may “crash and burn” because of the lack of cooperation among the company, its lenders and its lower-ranking creditors, a judge said and Bloomberg Business reported yesterday. Bankruptcy Judge Tamara O. Mitchell said that she doesn’t see how a 30-day window to foster discussions among the company and the creditors will help, “given the complete lack of success in negotiations.” Lawyers for Birmingham, Ala.-based Walter Energy are seeking approval of a new deal with lenders to use cash representing collateral for its debt over the next 30 days. Lenders said that they would no longer let the company use the cash on the court’s previously approved terms and scrapped a pact to support a restructuring plan. The coal miner filed for bankruptcy in July after reaching an agreement with the lenders to support a reorganization plan that would hand them control in exchange for about $1.9 billion in debt. The case is In re Walter Energy Inc., 15-02741, U.S. Bankruptcy Court, Northern District of Alabama (Birmingham).
