PG&E Corp. says that it expects to file its plan for reorganization with the bankruptcy court by Sept. 9 and sees emerging from chapter 11 protection by May 1, Bloomberg News reported. The bankrupt utility says in the filing that it has $10.5 billion in equity commitments with more than 20 financial institutions signed up to help fund its recovery plan. PG&E says that several financial institutions have expressed confidence that they can raise $35 billion to $40 billion of both debt and equity capital to satisfy claims, refinance indebtedness, and address other bankruptcy related and post-emergence uses. The company said that the plan values the reorganized equity in multiples higher than proposed in a competing bid by an ad hoc group of bondholders led by Pacific Investment Management Co. and Elliott Management Corp. Read more.
In related news, PG&E said yesterday that it had received more proposals for equity commitments to support the company’s reorganization, following an earlier offer by hedge funds Knighthead Capital Management and Abrams Capital Management, Reuters reported. The commitments currently exceed $12 billion, the company said in a statement. Last week, shareholders Knighthead Capital and Abrams proposed raising $15 billion in equity to fund a planned reorganization of PG&E, which is facing over $30 billion in liabilities from severe wildfires in California. The proposed fundraising, a rights offering of new shares, is the latest effort to rescue the power producer, which sought chapter 11 bankruptcy protection earlier this year. Read more.
