PG&E Corp., the bankrupt California power giant facing $30 billion in wildfire liabilities, is nearing a deal with a group of investors that includes naming Bill Johnson as chief executive officer and overhauling its board, according to people familiar with the matter.
PG&E is nearing an agreement with the group — consisting of Knighthead Capital Management, Redwood Capital Management and Abrams Capital Management — to hire Mr. Johnson, the outgoing CEO of the federally operated power agency Tennessee Valley Authority, said the people, who asked not to be identified because the matter is private. The deal, which would also keep three current directors and nominate 10 others for the board, could be announced as soon as Wednesday, the people said.
Mr. Johnson would be appointed to the board at a later date subject to a shareholder vote, they said. While an agreement is close, no final deal has been reached and talks may still fall apart, the people said.
A representative for San Francisco-based PG&E said the company doesn't comment on market rumors or speculation. A representative for the investor group declined to comment.
TVA spokesman Jim Hopson said the utility isn't aware of Mr. Johnson's plans after he leaves the agency. Mr. Johnson didn't have an immediate comment, Mr. Hopson said.
PG&E, shares of which have fallen 25% this year, rose as much as 2.3% and then fell as much as 2.1% Tuesday. Its shares were down 1.6% to $17.72 at 3:42 p.m. in New York trading.
The appointments follow an intense, weeks-long battle over who will lead PG&E out of the biggest utility bankruptcy in U.S. history. The three shareholders, which collectively own almost 10% of PG&E, disclosed their plans to push for changes at the company last month.