FirstEnergy Corp. has reached a settlement with creditors of its bankrupt power-generation businesses that would simplify their restructuring while extricating the parent company from the chapter 11 case, WSJ Pro Bankruptcy reported. The proposed deal with the nonbankrupt parent company requires approval from subsidiary FirstEnergy Solutions, or FES, and its affiliates and from the Ohio chapter 11 judge overseeing their restructuring. If approved, the agreement covers potential claims surrounding FirstEnergy’s obligations toward unprofitable coal and nuclear power plants in Ohio and Pennsylvania that are under bankruptcy protection. Research firm CreditSights said the settlement provides 15 cents on the dollar for holders of unsecured FES debt, some of which rallied nearly 20 percent yesterday, according to FactSet.
