PG&E Reportedly Eyeing Breakup, Bankruptcy In Wake Of Multiple Devastating Wildfires

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Because of potential legislative aid, PG&E has not yet determined whether it will make a bankruptcy filing, Reuters reported. The shares were down 23 percent in pre-market trading.

A bankruptcy filing reportedly is not PG&E's preference for addressing the liabilities, but the preparations could put pressure on California politicians hoping the company can avoid such an outcome.

PG&E "could face a liquidity crisis by mid-to-late '19", Greg Gordon, an analyst at Evercore ISI, said in a research note Monday.

Reuters reported previous year that the company was working with bankruptcy advisors.

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The utility, California's largest, is contending with potentially crippling liability costs related to California's Camp Fire. California lawmakers have passed a law that would protect the company from the 2017 fire and fires in 2019 and after but not the 2018 fire. Safety is and will continue to be our top priority as we work to determine the best path forward for all of our stakeholders. But they added that "exploitive tactics and a reticence toward change will not improve" the company's profile. The filing isn't certain, the people said, but it may be enough to force the hand of state legislators who could come up with a rescue package. Holden didn't immediately respond to a request for comment sent after hours on Friday.

" Legislation is the way forward as it will allow to keep the utility alive and mitigate any negative impact one can get from the bankruptcy", Pourreza said.

Pacific Gas & Electric is preparing to take a significant charge for liabilities related to the wildfires of 2018 and 2017.

"We want to tap fresh perspectives and additional expertise to help address the changing nature of PG&E's business and the challenges it faces now and in the future", the board said in a statement.

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The company has considered seeking financial shelter in bankruptcy court because of the potential liabilities, Reuters reported, citing anonymous sources.

The California Public Utilities Commission last month opened proceedings to consider penalties against the company for falsifying pipeline safety records.

"Without adequate political and regulatory support, we can not rule out a Chapter 11 filing", Christopher Turnure analyst at J.P. Morgan said in a note.

Konolige, meanwhile, wouldn't rule out what he called a strategic bankruptcy.

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