Bluestone Resources, the coal company owned by Governor Jim Justice and his family, reports progress in talks over nearly $ 700 million debt with international finance company Credit Suisse.
A statement released today by Bluestone referred to “several days of face-to-face meetings last week in West Virginia.”
The Justice firm said it has agreed to a framework with Credit Suisse to work on the restructuring of debt obligations following the insolvency of Bluestone’s main lender, Greensill Capital.
The Financial Times today cited a source who described “more constructive conversations” but that Bluestone’s announcement “was a bit premature” and no deal was signed.
Credit Suisse declined to comment on MetroNews and other news outlets.
The Wall Street Journal reported that the strategies to offset debt include increasing production from Bluestone-operated coal mines, revitalizing the judge-owned Greenbrier Resort to increase profitability and leverage more of the profits from the Justice family land holdings. The Journal, citing anonymous sources, said there were no plans to sell any assets.
Legal firms took out hundreds of millions of dollars in loans from Greensill Capital in 2018. Greensill conditioned these loans and sold them to investment funds managed by Credit Suisse.
Greensill declared bankruptcy this spring after Credit Suisse frozen billions in funds.
Credit Suisse is now pushing to recover lost investments and has appointed Justice’s Bluestone Resources as one of the top three borrowers from Greensill funds.
A Bluestone statement today referred to discussions with Credit Suisse “to resolve a significant portion of its loan exposure.”
âThese constructive developments with CS will allow Bluestone to return to a state of normalcy, so that we can continue to supply high quality coal and coke to our customers around the world, while providing a stable and secure situation for our valued customers. employees and businesses. said Jay Justice, the governor’s son who runs the coal operations.
The loans to Bluestone Resources were unusual in that they were backed by “potential receivables” that were not yet available from a list of “potential buyers” – “a list that included both existing customers of Bluestone and other entities that were not and may never become customers of Bluestone.
Justice companies have continued Greensill – accusing the company of “continuous and lucrative fraud”. The lawsuit notes that the Governor of Justice owns a 60 percent stake in Bluestone Resources. Cathy Justice is also listed as a complainant.
International financial history hit home this summer amid the revelation that Governor Justice and his wife Cathy had signed personal guarantees and could be on the hook for debt after the Greensill collapse. The Wall Street Journal first reported Personal Responsibility for Justice in an article titled “West Virginia Governor Jim Justice Personally Responsible for $ 700 Million in Greensill Loans.”
In a briefing earlier this week, the governor alludes to probability of relief to come.
âI hope you will see a situation tomorrow with the folks at Credit Suisse and the Greensill thing as this situation evolves in a positive direction,â Justice said Tuesday.
It turns out the timeline was off by a few days, but today’s statement appears to be what the governor described.
In early June, the governor of justice called Greensill bad faith and suggested his companies were unaware of the ins and outs of the larger relationship with Credit Suisse.
âIf you knew all the details, you would know that obviously Greensill is a bad, bad actor. And almost in partnership with that, you have the folks at Credit Suisse who were hip-related with Greensill that we didn’t know anything about. From the perspective of what Greensill did, how on earth could we have known anything? “