Court approves USD-23bn bankruptcy financing plan for PG&E

Pacific Gas and Electric Co (PG&E) has been cleared by the bankruptcy court of Northern California to raise up to USD 23 billion (EUR 20.9bn) in financing to support its turnaround plan.

The move comes after California governor Gavin Newsom abandoned his opposition to the particular financing package, according to media reports.

Specifically, the court has given the green light to a financing motion for USD 11 billion in debt commitments and USD 9 billion in new equity, a filing has revealed. Separately, PG&E can raise a further USD 3 billion by issuing new shares.

PG&E and its holding company PG&E Corporation (NYSE:PCG) filed voluntary petitions under Chapter 11 of the US Bankruptcy Code in late January 2019, as the business was burdened with liabilities following wildfires caused by its own power lines. In December 2019, the company agreed to a settlement that resolved all claims arising from the fires and in January 2020 reached a deal with bondholders on its restructuring.

The company has to exit bankruptcy by the end of June so it could take part in a state wildfire fund.

(USD 1.0 = EUR 0.908)

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