Businesses owned by Gov. Jim Justice and his family have offered $300 million plus the possibility of half the value of their coal properties to pay off major debts, The Wall Street Journal reported today.
Credit Suisse, an international lender, has said the total Justice debt originally amounted to $850 million.
The Journal reported that Justice’s companies, in ongoing talks, have offered to pay $300 million — an amount that would come through refinancing a portion of the loans through a third-party lender.
More money could come through the sale or public offering of Bluestone, Justice’s coal company that owes on the loans.
So the proposal means Credit Suisse could be paid back millions of dollars fairly quickly to satisfy what it owes to others while the Justice companies could wind up shaving millions of dollars off what they owe.
Governor Justice generally acknowledged the accuracy of the Wall Street Journal story during a statewide briefing today.
“I haven’t seen it. I think it’s pretty accurate,” Justice said in response to a question by reporter Steven Allen Adams of the Ogden Newspapers.
But Justice went on to say, “I think it would be very, very premature for me to have a whole lot of comment on it. I think the Credit Suisse folks and ourselves are working together and working together really, really well.”
A settlement could halt Justice’s financial peril in what seemed an avalanche of debt earlier this summer. Justice had personally guaranteed millions of dollars in loans to the now-bankrupt international lender Greensill, which sold the debt package to Credit Suisse investors, and to Carter Bank & Trust of Martinsville, Va.
Credit Suisse has been pressing to recover lost investments and has has named Justice’s Bluestone Resources as one of three major borrowers from the Greensill funds. That original loan amount was $850 million, although that’s been paid down to the $700 million in question.
The loans from Greensill to Justice’s Bluestone Resources were unusual in that they were backed by “prospective receivables” that weren’t yet in hand from a list of “prospective buyers” — “a list that included both existing customers of Bluestone and other entities that were not and might never become customers of Bluestone.”
The Journal reported that Greensill packaged such loans and sold them to investment funds managed by the financial services company Credit Suisse.
“We got the rug just jerked right out from underneath us, with the Greensill folks and with what happened to Greensill,” Justice said today. “I’ve said it over and over — bad actors, very bad actors.”
Justice’s companies last month settled legal disputes with longtime lender Carter Bank over $368 million in loans. Justice’s companies dropped a federal lawsuit while Carter dropped circuit court claims on millions of dollars in defaulted loans.
Carter released a statement to stockholders earlier this month, briefly describing the effects of the settlement.
“Carter Bank continues to believe that it is fully secured on all loans it has outstanding to the Justices and the Justice Entities,” the bank stated.
“In connection with the dismissal of the Lawsuit and the execution of the Releases, the Justices and the Justice Entities have also enhanced Carter Bank’s collateral position, including cross-collateralizations, and executed documents reaffirming the legality, validity and binding nature of all loan documents they have executed in favor of Carter Bank.”
Justice and his families own a network of dozens of businesses in the coal, agriculture and tourism industries. Today, Justice said those businesses are in good shape.
“From the standpoint of my family’s finances, they’re great,” Justice said. “They’re absolutely great. The coal business is doing fantastic. The Greenbrier is doing great. Let’s just continue to move forward.”