Energy Future Holdings files for Chapter 11 bankruptcy protection
Energy Future Holdings filed for Chapter 11 bankruptcy Tuesday, a culmination of months of negotiations to speed up a restructuring of the Dallas-based power provider's massive debt of more than $40 billion by parceling out pieces of EFH's business.
EFH filed for protection in the U.S. Bankruptcy Court in Wilmington, Del.
According to a report in the Wall Street Journal, Energy Future Holdings has presented a plan that would swap Texas Competitive Electric Holdings to get $25 billion worth of debt forgiven. Texas Competitive Holdings is a subsidiary that sells electric power in wholesale markets to big companies and other utilities.
Energy Future Holdings skipped $100 million in debt payments coming due this week, setting up the bankruptcy filing.
The Journal reported that EFH also has been in discussions with bondholders owed $1.7 billion about converting their debt to ownership stakes in Energy Future Intermediate Holding Co., its subsidiary that owns Oncor. EFH also owns retailer electric provider TXU Energy and power generator Luminant.
Oncor is EFH's regulated subsidiary that delivers power to more than 10 million customers throughout Texas.
EFH negotiated more than $11 billion in loans in preparing for the bankruptcy filing to ensure that it could continue ongoing operations during Chapter 11 proceedings, the Journal reported.
EFH formed out of the largest leveraged buyout in history when private equity firms took the old TXU Corp. private in 2007.
Lance Murray edits and writes for the DBJ's website and can be reached at 214-706-7106
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