July 2, 2020
PG&E Stock Is Climbing to Start Its First Day Out of Bankruptcy
by Alexandra Scaggs
Barrons.com
Pacific Gas and Electric shares opened higher on the California utility’s first day of trading after emerging from bankruptcy.
PG&E (ticker: PCG) filed for Chapter 11 reorganization in January 2019 after its equipment was found to have caused some of the most destructive wildfires in the state’s history.
Because its restructuring plan was approved by the bankruptcy court last month, the company will be able to take part in a state wildfire fund, half financed by California rate payers, created to cover costs of future catastrophic wildfires. It contributed $5 billion to the fund as part of its emergence, the company said.
The fund payment, and its settlements with insurers and wildfire victims have been financed in part with $20 billion of debt and equity sales the company priced last month. Wildfire victims’ settlements were partly funded with new shares as well. The company’s reorganization plan created a trust for fire victims that owns equity representing a roughly 22% ownership stake in the company.
The utility also has a new board of directors and a new interim chief executive: Bill Smith, a retired AT&T Services executive who has served on PG&E’s board since October 2019. Its prior CEO, former Tennessee Valley Authority executive Bill Johnson, stepped down at the end of last month ahead of the company’s emergence from bankruptcy.
The stock was up 1.6% at $9.17 in late morning. It is down about 16% year to date and 59% over 12 months.
http://www.barrons.com/articles/pg-e-stock-is-climbing-to-start-its-first-day-out-of-bankruptcy-51593696492?siteid=yhoof2&yptr=yahoo
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