Bankrupt utility giant PG&E Corp. is offering $13.5 billion in compensation to the victims of wildfires sparked by its power lines as part of a restructuring plan, according to people with knowledge of the situation.
In doing so, the San Francisco-based power company is trying to provide the same amount that a group of its creditors — led by Pacific Investment Management Co. and Elliott Management Corp. — has agreed to pay victims in a rival reorganization proposal, said the people, who asked not to be identified because the negotiations are private. The two sides are at odds, however, over how to structure the payout and how much should come in the form of cash and stock, they said.
PG&E has spent months trying to come up with a restructuring plan that would get it out of the biggest utility bankruptcy in U.S. history by the middle of next year. The utility filed for bankruptcy protection in January after its equipment was found to have started a series of catastrophic wildfires in 2017 and 2018, burying it in an estimated $30 billion worth of liabilities.
An $11-billion deal that PG&E had already struck with wildfire insurers has come under attack as negotiations between the company and actual fire victims drag on. A group of victims has filed a lawsuit against the utility, saying they should get paid before insurers do.
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