Subject category:
Finance, Accounting and Control
Published by:
Harvard Business Publishing
Version: 1 September 2023
Revision date: 11-Sep-2023
Length: 33 pages
Data source: Published sources
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Abstract
In early 2020, the California-based utility PG&E filed a second amended plan of reorganization. PG&E had filed for Chapter 11 bankruptcy in the face of more than USD30 billion of legal claims brought against it for its alleged role in causing California wildfires. The plan had the support of key creditors and shareholders and a court-appointed committee representing the wildfire victims. However, it faced strong opposition from California's governor, Gavin Newsom, who was concerned that PG&E's plan would leave it too highly leveraged, and unable to make necessary investments. Were Newsom's concerns valid ones? Did the plan as currently envisioned leave the reorganized PG&E with too much debt to meet its obligations to the wildfire victims while still making the necessary investments to update its equipment? And was PG&E prepared for the new reality of climate change?
Location:
Industry:
Size:
> 1 billion; Fortune 500
Other setting(s):
2019-2020
About
Abstract
In early 2020, the California-based utility PG&E filed a second amended plan of reorganization. PG&E had filed for Chapter 11 bankruptcy in the face of more than USD30 billion of legal claims brought against it for its alleged role in causing California wildfires. The plan had the support of key creditors and shareholders and a court-appointed committee representing the wildfire victims. However, it faced strong opposition from California's governor, Gavin Newsom, who was concerned that PG&E's plan would leave it too highly leveraged, and unable to make necessary investments. Were Newsom's concerns valid ones? Did the plan as currently envisioned leave the reorganized PG&E with too much debt to meet its obligations to the wildfire victims while still making the necessary investments to update its equipment? And was PG&E prepared for the new reality of climate change?
Settings
Location:
Industry:
Size:
> 1 billion; Fortune 500
Other setting(s):
2019-2020