PG&E Corp. has spoken to lawmakers about putting together a pool of capital worth about $11 billion to settle claims related to wildfires blamed on the bankrupt California utility, Bloomberg News reported. The utility has considered the plan in consultation with law firm Jones Day and boutique investment bank PJT Partners Inc., which are advising a group of PG&E’s equity holders that recently helped overhaul its board and appoint Bill Johnson as chief executive officer. The holders include Knighthead Capital Management, Redwood Capital Management and Abrams Capital Management, which collectively own about 10 percent of PG&E’s shares. The plan calls for PG&E to set up a special purpose vehicle into which it would redirect about $400 million a year in earnings. The fund would help finance a pool of capital that would earmark about $8 billion to settle wildfire claims from 2017 and 2018, one of the people said. At least another $3 billion would be earmarked for future claims. The proposal wouldn’t require assistance from the state, taxpayers or customers of the utility. It also wouldn’t address any claims from the 2017 Tubbs fire or others that regulators determined PG&E wasn’t responsible for. Details of the plan haven’t been finalized, and the terms may still change.
