PG&E secures billions in loans

PG&E Corp. has lined up more than $34 billion in debt financing to help with its plan to exit bankruptcy protection and pay victims of the deadly wildfires caused by its power lines.

In a Securities and Exchange Commission filing on Tuesday, the company said seven lenders have agreed to provide a $27.35 billion loan for utility subsidiary Pacific Gas and Electric Co. and a $7 billion loan for the parent company.

The debt agreements come on top of $14 billion in equity commitments PG&E previously secured from investors as it tries to advance its plan to resolve its massive bankruptcy case.

PG&E is now officially competing with a rival plan backed by a committee of fire vic

tims and a group of bondholders who want to seize control of the company. That’s because U.S. Bankruptcy Judge Dennis Montali last week agreed to break PG&E’s exclusive right to present a reorganization plan so the other group could formally introduce its own.

James Noonan, a spokesman for PG&E, said in an email that the debt and equity commitments “underscore the strength of, and broad support for” the companybacked plan. He said PG&E is focused on securing regulatory approval in time to resolve its case by June 30, about a year and a half after the company sought protection under Chapter 11 of the U.S. Bankruptcy Code. PG&E must meet the June deadline in order to be eligible for a new fund established by the state that will protect it from future fire costs.

“While others attempt to extract profit from our bankruptcy, we are focused on advancing our comprehensive and fair Plan to emerge from Chapter 11 in a timely manner as a financially sound utility,” Noonan said in his email.

PG&E’s plan includes creating a trust of $8.4 billion from which the claims of individual fire victims would be paid. The other plan would create a similar fund of $14.5 billion — and give bondholders control of PG&E.

Separately, the company and its utility subsidiary are getting two new board members: Bill Smith, 62, is the retired president of AT&T Technology Operations at AT&T Services Inc., and John Woolard, 54, is CEO of Meridian Energy and a senior operating partner at Activate Capital in San Francisco.

The debt agreements come on top of $14 billion in equity commitments PG&E previously secured from investors.