A judge said yesterday that he would grant final approval to PG&E Corp.’s $5.5 billion bankruptcy loan, over the protests of wildfire victims who said the utility surrendered too much control to Wall Street banks, WSJ Pro Bankruptcy reported. Judge Dennis Montali approved the financing during a hearing in a bankruptcy court in San Francisco. Hit with claims for an estimated $30 billion in damages from years of wildfires sparked by its equipment, PG&E said the financing is essential to stabilize its business during a chapter 11 proceeding that is expected to last for years. The lending syndicate is led by J.P. Morgan Securities LLC; Merrill Lynch, Pierce, Fenner & Smith Inc.; Barclays Bank PLC; Citibank NA; BNP Paribas Securities Corp.; Credit Suisse Loan Funding LLC; Goldman Sachs Bank USA; MUFG Union Bank NA; and Wells Fargo Securities LLC. Approval was held up for weeks while the official committee representing wildfire victims pressed lenders for concessions on provisions that dictate what happens if PG&E defaults on the loan. Read more.
In related news, Some of the biggest players in distressed debt are proposing a $35 billion plan that would allow California utility giant PG&E Corp. to emerge from bankruptcy within a year, Bloomberg News reported. Pacific Investment Management Co., Elliott Management Corp. and Davidson Kempner Capital Management have been meeting with California lawmakers and other stakeholders to discuss the proposal, the people said, asking not to be identified because the discussions are private. The plan would establish a $14 billion cash trust to pay for claims tied to the deadly 2017 and 2018 wildfires that forced the utility to declare bankruptcy, according to the proposal seen by Bloomberg News. Read more.
