Arch Coal Debt Deadline Extended

Arch Coal said the deadline for its debt exchange plan had been extended again, to Oct. 26, as a court hearing on a legal battle between its creditors is scheduled for Friday.

A creditor sued a group of lenders last week, alleging that they are trying to use the struggling U.S. miner's credit agreement to block its out-of-court restructuring efforts and push it into bankruptcy.

GSO Special Situations Master Fund LP, which holds some of Arch Coal (ACI)'s unsecured notes, has sought a temporary restraining order against the lenders in the case filed in the New York State Supreme Court.

Arch Coal's shares rose more than 8 percent to $3 in premarket trading on Thursday.

Stricter regulation and falling demand in the coal market have already pushed smaller miners such as Alpha Natural Resources and Patriot Coal into Chapter 11 bankruptcy.

Coal futures fell below $50 per ton on Thursday for the first time since 2003, after Goldman Sachs warned that coal would never gain enough traction to lift it out of the slump.

Arch's debt restructuring plan includes swapping existing debt for longer-term securities to reduce total debt and annual interest expenses by around 20 percent.

Reporting by Tracy Rucinski and Shubhankar Chakravorty