A group of PG&E Corp. creditors could preempt the embattled California utility's own attempt to claw its way out of bankruptcy by presenting a restructuring plan that could be worth at least $45 billion, according to people familiar with the matter.
The plan builds on a proposal floated earlier this year. The updated plan includes substantially more cash for compensating existing wildfire victims, establishing a new statewide wildfire liability fund and recapitalizing PG&E, said the people, who asked not to be identified because the details are private.
The plan could be presented to the bankruptcy court judge before a rival plan being developed by PG&E's newly reconstituted board and management is finalized to help accelerate the utility's exit from court protection, the people said.
The ad-hoc committee of creditors — led by Pacific Investment Management Co., Elliott Management Corp. and Davidson Kempner Management — originally floated a $35 billion plan with lawmakers and other stakeholders. Representatives for PG&E and PIMCO weren't immediately available for comment. Representatives for Elliott and Davidson Kempner declined to comment.
The original proposal included a $14 billion cash trust to pay claims tied to the deadly 2017 and 2018 wildfires that forced the utility to declare bankruptcy, people familiar with the matter said at the time. It also contemplated establishing a $13 billion statewide wildfire fund that would be financed by PG&E and other California utilities. It also would have provided $8 billion to recapitalize the San Francisco-based company, allowing it to refinance its debtor-in-possession loan and other maturities.
The plan called for about $18.5 billion in funds to be provided by the creditor group, with roughly half in equity and half in debt-linked securities.