UK Coal completes restructure - FT.com UK Coal had given its deep pits "a fighting chance of survival" after a restructuring that avoided certain receivership in the next few months, its chairman said. Jonson Cox said splitting the company into mining and property arms and giving control of its coal mines to its pension funds was the only way to prevent it failing under the weight of bank and pension debts. "The support provided has given a final chance to the mining business, mine management and workforce, to adopt the changes needed to ensure safe, reliable and efficient production for the next 5-10 years," Mr Cox said. However, he said that despite a 12.5 per cent cut in deep mine labour costs last year it would probably require a further 20 per cent reduction to make them sustainable. UK Coal, which acquired the bulk of Britain's pits on privatisation in 1994 but now owns just three, was on Monday renamed UK Coalfield Resources. The mining division, with deep and open cast mines, becomes Mine Holdings and the property arm retains the Harworth Estates name. The mining business is owned by two entities: Coalfield Resources owns 33 per cent of the voting shares and 90 per cent of any economic value deriving from the mines, and an employee benefit trust for employees owns 10 per cent of the economic value and 67 per cent of the voting shares. Both parties interests stand behind the debts due to the pension funds. The pension funds also receive 75.1 per cent of Harworth Estates in return for a £30m investment to help develop its £280m property portfolio on former coalfields. Shareholders, who include Peel Holdings, the property developer, and funds controlled by Henderson and Invesco, are left with 24.9 per cent of Harworth via Coalfield Resources. Harworth is solely responsible for most bank debt, £70m, but cannot be called on as in the past to fund the mines and is free of its pension burden. Four power generators who are owed £80m will offer £50m in support and receive payment in coal. The pension funds will also suspend £40m of deficit payments over the next two years. Mr Cox said other companies dealing with "legitimate" legacy pension claims could take heart. This is one of the first really innovative deals done with the backing of the pensions regulator. Without the agreement of all, which came at 6am on Monday, receivers would have been called in the second quarter of 2013, Mr Cox said. About 2,500 jobs would have been lost - without redundancy payments - and a further 3,000 in the supply chain. Pensioners would have lost up to a third of their pensions and creditors would have received 1p-3p for every pound owed. Shares rose 24 per cent to 9p.