Bankruptcy Judge OKs PGE Recovery Plan
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ENERGY
PG&E; Corp.’s Pacific Gas & Electric unit received final approval from a judge for a plan to emerge from Chapter 11, which will allow the company to move forward with an $8-billion debt offering.
U.S. Bankruptcy Judge Dennis Montali signed an order confirming his earlier decision that Pacific Gas’ reorganization plan was legal and in the best interest of creditors. He had waited to finalize the ruling until after California regulators voted to accept the plan last week. PG&E; needs the order before it can sell bonds to raise money to pay creditors owed $12 billion.
The plan provides Pacific Gas with enough cash to receive investment-grade credit ratings, lower electricity charges, make an 11.2% profit and restore dividends by 2005. The company must sell $8 billion in debt securities and use $4 billion in customer payments to finance the plan.
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