A powerful Texas state senator warned against a takeover by hedge funds of the power distribution unit of bankrupt Energy Future Holdings and said the state would prefer an owner with a long-term view, Reuters reported on Friday. Senator Troy Fraser told Reuters on Friday that Texas prefers that the new owner of the power distribution unit, Oncor, invest cash in the business, and would be concerned about any deal that increases debt levels. Fraser is chairman of the Texas Senate Committee on Natural Resources. He opposed the 2007 leveraged buyout that loaded Energy Future, then known as TXU Corp, with much of the $41 billion in debt it carried into bankruptcy in April. A bankruptcy judge today will consider competing proposals for refinancing the debt of the Energy Future unit that owns Oncor; those proposals could determine who controls Energy Future after its bankruptcy.
