PG&E in California Secures $5.5B in Credit and Loans to Operate During Bankruptcy

The nation’s largest utility has lined up $5.5 billion in credit and loans so it can continue operating as it prepares for bankruptcy.

Pacific Gas & Electric said in a regulatory filing Tuesday it secured commitments from JPMorgan Chase, Bank of America, Barclay’s Bank and Citigroup Global Markets.

Without the new financing, the utility could have problems accessing capital. PG&E’s stock lost more than 80 percent of its value in the last two months and S&P slashed its credit rating to junk status after California’s deadly wildfires.

Under the proposal, the new creditors would be given a high priority for repayment in bankruptcy proceedings.

Barry Adler, a professor at New York University, says the new financing could help increase the size of the pie to be divided among creditors.

Related:

• Hedge Fund Baupost Reported to Hold $1 Billion in PG&E Insurance Claims
• PG&E Bankruptcy Looms With $30B in Potential Liabilities from California Wildfires; CEO to Exit
• California Utility’s Bankruptcy Talk Sets Stage for Showdown with State

Topics California