The three companies were named the winner of an auction by the bankruptcy court after they made a combined offer of $786 million for the Horizon mines, including $304 million in cash. Horizon was valued at a little less than $1 billion and had a similar amount of debts. The sale will be finalized at an August 31 hearing in Lexington, Kentucky. Horizon says it has operations at 20 locations in four states.

This carve-up marks the next stage in an ongoing battle by the United Mine Workers of America (UMWA) to defend union contracts and the health-care benefits of working miners and retirees. Federal bankruptcy judge William Howard ruled August 9, after an earlier hearing, that Horizon does not have to honor its union contracts and its obligations for union retiree pensions and health-care benefits at the six mines it operates that are organized by the UMWA. This affects 800 working miners and 2,300 retirees. Howard said in his ruling that no buyer would want to take on the financial obligations associated with the union mines. A Horizon spokesperson said that the contractual obligations made the union mines an “unattractive” offer.

Miners and retirees have been actively resisting this attack. The union has organized several protests at the bankruptcy court. Around 1,000 took part at the last protest on July 20. About 1,500 miners, retirees, and supporters rallied August 31 in Lexington, Kentucky, outside the court where the judge was finalizing the sale (further coverage in upcoming issues).

Miners have also shown their opposition to the company’s course by taking union “memorial” days. Miners at the Cannelton mine in southern West Virginia have taken nine such days in a year. The current union contract allows for 10 memorial days in the life of the contract. These stoppages have enabled big participation of working miners at the protests in Kentucky.

“I went to Lexington when the judge ruled and there was a good show of support but we can’t fight this one on our own,” said Art Roach, a miner at Ziegler Coal in southern Illinois. “I think we should go to Washington, D.C., and show them who runs this country.”

Financier Wilbur Ross has made his mark taking over bankrupt companies, where, as part of deals with the courts, the new owner has no responsibility for obligations to retirees. Pensions are taken over by the federal government, which often results in a substantial cut in retirement benefits. Health-care benefits are eliminated.

This is how Ross built International Steel Group in a few years into the largest steel producer in the United States, after taking over bankrupt or ailing steelmakers LTV, Bethlehem Steel, and Weirton. Ross also owns a textile operation called International Textile Group based on ownership of Burlington Industries and the takeover of the bankrupt Cone Mills.

Ross said he became interested in Horizon because he believes coal will undergo an economic boom in the next decade. “We’ve made some small investments in coal,” he said. “This is our first big investment.” Ross says he sees opportunities to buy other coal producers in the Appalachian area. The financier was named the lead buyer in the bankruptcy process. Ross’s companies are slated to take over two union mines—Ziegler 11 in southern Illinois and Marrowbone in southwestern West Virginia.

Union mines Cannelton, in southern West Virginia, and Starfire, in eastern Kentucky, are slated to be taken over by Massey Energy. “We are very pleased to acquire these valuable properties that complement Massey’s other Central Appalachian holdings,” said Massey’s chairman Don Blankenship.

Cannelton is on the north banks of the Kanawha river. South of it, in the Big Coal river valley, Massey has a slew of operations. It was here in the mid-1980s that UMWA members resisted the company (then A.T. Massey) and its attacks on the union as the company bought up previously union-organized mines in the area.

None of the Massey mines in Big Coal river are unionized now. Likewise, Massey has sizable operations in eastern Kentucky, all of them nonunion. Starfire, a surface operation, is the only UMWA mine in eastern Kentucky.

Tony Lane is a member of UMWA Local 1248 in southwestern Pennsylvania.  
 
 
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