PG&E news: Stocks plummet 52% as bankruptcy claims confirmed
PG&E shares plummet 52% as the company confirms it is filing for bankruptcy protection due to financial troubles.
Speculation around PG&E's bankruptcy claims surfaced on Sunday after the utility company announced its CEO, Geisha Williams had resigned amid pressures from liabilities linked to the California wildfires.
But, PG&E put bankruptcy doubts to rest on Monday when it confirmed it will file for Chapter 11 bankruptcy protection.
It comes as the company faces an estimated $30 billion lawsuit for its role in allegedly sparking many of the 2017 & 2018 California wildfires.
Investigators had previously determined that PG&E’s equipment was accountable in at least 17 major wildfires in 2017, while investigations are still underway to determine the level of the company’s responsibility in November’s campfire.
On November 8 2017, PG&E disclosed that its equipment malfunctioned in the area shortly before the fire started.
PG&E Corporation Interim CEO, said: ‘We believe a court-supervised process under Chapter 11 will best enable PG&E to resolve its potential liabilities in an orderly, fair and expeditious fashion.
We expect this process also will enable PG&E to access the capital and resources we need to continue providing our customers with safe service and investing in our systems and infrastructure.'
PG&E assured its customers that there would be no impact to electric or natural gas services for its customers because of the bankruptcy.
PG&E share crash
Shares of PG&E crashed to $8.38 per share on the back of the bankruptcy news, plummeting more than 52%.
The stock has already lost 80% of its value over the last three months, and the market value of the company declined to $4.7 billion from $26 billion in 2017.
Bonds of PG&E plunged, trading sharply lower on Monday, sending their yields to record highs. Bonds maturing in October 2020 and May 2021 both fell by more than 7 points in price.
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