PG&E preparing to initiate voluntary reorganization cases under Chapter 11
PG&E Corporation filed today a 15-day advance notice that it and its wholly owned subsidiary Pacific Gas and Electric Company intend to file petitions to reorganize under Chapter 11 of the U.S. Bankruptcy Code on or about Jan. 29.
The company expects that the Chapter 11 process will enable the company to access the capital it needs to continue providing safe service to its customers and enable it to resolve its liabilities resulting from the 2017 and 2018 Northern California wildfires. The company plans to continue its restoration and rebuilding efforts in communities affected by the wildfires throughout the Chapter 11 process.
“Following a comprehensive review with the assistance of our outside advisors, the PG&E Board and management team have determined that initiating a Chapter 11 reorganization for both the Utility and PG&E Corporation represents the only viable option to address the Company’s responsibilities to its stakeholders,” Richard C. Kelly, chair of the Board of Directors of PG&E Corporation, said.
The company said that it will work with regulators, policymakers and other stakeholders to determine a long-term plan for providing the safe delivery of natural gas and electric service and ensuring that the company has access to the capital and resources needed to support ongoing operations and continued investment in its systems, infrastructure and safety efforts.
“Our goal will be to work collaboratively to fairly balance the interests of our many constituents—including wildfire victims, customers, employees, creditors, shareholders, the financial community and business partners—while creating a sustainable foundation for the delivery of safe service to our customers in the years ahead,” Kelly said. “The Chapter 11 process allows us to work with these many constituents in one court-supervised forum to comprehensively address our potential liabilities and to implement appropriate changes.”
PG&E said that it expects its electric or natural gas service for its customers to continue without disruption throughout the Chapter 11 process. The company also said that its restoration and rebuilding efforts will continue and that its employees will continue to receive their pay and healthcare benefits.
The company also said that it has engaged in discussions with potential lenders with respect to Debtor-in-Possession (DIP) financing. It expects to have approximately $5.5 billion of committed DIP financing at the time it files for relief under Chapter 11.
