Peabody has announced it will offer US$1 billion in senior secured second lien notes.
It comes as the miner seeks to make a cash offer for its existing outstanding notes due in 2016.
According to Peabody it will use the proceeds from the notes sale to fund the tender to purchase the aforementioned existing outstanding US$650 million worth of 7 3/8 per cent senior notes.
It will also use the cash for payment of its federal coal lease expenditures.
“The notes will be secured by a second-priority lien on all of the assets that secure the company's and the guarantors' obligations under the company's senior secured credit facility, subject to permitted liens and other limitations,” Peabody said.