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Judge Dennis Montali of the U.S. Bankruptcy Court in San
Francisco turned down requests from two groups of creditors
wanting to propose a Chapter 11 exit plan for PG&E, which is
facing huge liabilities from California wildfires.
PG&E, a holding company whose main subsidiary is the California
utility Pacific Gas and Electric Company, sought Chapter 11
bankruptcy protection earlier this year after severe wildfires
in 2017 and 2018 resulted in more than $30 billion in
liabilities.
Montali said he believed allowing PG&E to retain the right to
lead the process would be a speedier resolution for victims of
fires that were caused by equipment belonging to the California
utility, according to the court documents.
In its response, PG&E said it planned to file its plan of
reorganization by Sept. 9.
"PG&E has made significant progress in further refining a
viable, fair, and comprehensive plan of reorganization," the
company said in a statement.
"We can assure our customers and communities that we are looking
at all options in working with the Governor, the CPUC and all
stakeholders."
Hedge funds Knighthead Capital Management and Abrams Capital
Management, which are shareholders in PG&E, made a public
proposal earlier this month to raise $15 billion in equity to
fund a planned reorganization and pledged to purchase a portion
of the offered equity if shares are left unsold.
PG&E bondholders have proposed plans to inject money to help the
company emerge from Chapter 11, saying it has been too slow to
file its own plan.
(Reporting by Nivedita Balu in Bengaluru; Additional reporting
by Shubham Kalia; Editing by Leslie Adler & Simon Cameron-Moore)
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