Distressed debt ends week softer as liquidity slacks off; Alpha Natural firms on mine restart

By Stephanie N. Rotondo

Phoenix, Aug. 16 - The distressed debt market was "definitely off," a trader said Friday, as equities again turned negative and Treasuries slipped.

Alpha Natural Resources Inc., however, was going against the grain, managing to end unchanged to slightly better after the company said it had restarted its Cumberland mine in Pennsylvania.

One trader said the 6¼% notes due 2021 were steady at 82 bid, 82½ offered. The 6% notes due 2019 and the 9¾% notes due 2018 were both up half a point, he said, at 84 and par 1/2, respectively.

Another market source saw the 6¼% notes inching up a quarter-point to 82 bid.

On Aug. 2, the Bristol, Va.-based coal mining company reported a loss of about $186 million. The loss, though narrower than the previous year, was seen as yet another indication that the coal sector is on the decline.

Alpha Natural blamed the loss in part on its July closure of the Cumberland mine. The site had been shuttered in order to make roof repairs.

The company also said that "less than favorable" mining conditions at its Emerald mine played a role in the loss.

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