S&P slashes PG&E rating to junk status following deadly California wildfires

California Wildfire Liability May Cause PG&E To Sell Off Part of Company to Avoid BankruptcyMore

California Wildfire Liability May Cause PG&E To Sell Off Part of Company to Avoid BankruptcyMore

Sources said the company could still receive financial help through legislation that would let it pass on to customers costs associated with fire liabilities, staving off a bankruptcy filing.

Because of potential legislative aid, PG&E has not yet determined whether it will make a bankruptcy filing, Reuters reported. One option under consideration: Selling its natural gas business after a bankruptcy filing, the people familiar with the matter said.

Shares were down more than 18% early Monday.

"Rather than waiting for the regulators to tell you what's going to happen - which could take years", he said, "you're in the bankruptcy court where there's a structure". The company is weighing using proceeds from the unit's sale to address death and injury claims arising from the recent wildfires, this source said.

This follows Friday's report by Reuters saying the utility is considering the move for some or all of its businesses.

Three major insurance companies have filed a Camp Fire lawsuit against PG&E as a result of the billions of dollars in claims they are expecting.

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The California wildfires that scorched millions of acres across the Golden State in late 2018 caused widespread devastation, with loss of human life and property damage just some of the ways that the fires touched the lives of thousands of Californians.

The utility, California's largest, is contending with potentially crippling liability costs related to California's Camp Fire. But the bill did not cover 2018 fires.

In a statement late Friday, PG&E said it's "working diligently to assess the company's potential liabilities as a result of the wildfires and the options for addressing those liabilities".

PG&E added that it has formed a special board committee that includes independent experts to advise on wildfire safety best practices.

The San Francisco-based company has lost more than half its market value since the deadliest wildfire in California history broke out in early November, compounding financial woes it was already facing after blazes destroyed parts of wine country a year earlier.

The ratings agency said it could further cut the company's rating over the next few months if explicit steps are not taken by authorities to improve the regulatory situation, signaling that the agency may be losing faith that lawmakers could rescue PG&E.

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