PG & E (NYSE:PCG)
Historical Stock Chart
1 Month : From Jun 2019 to Jul 2019
By WSJ City
PG&E bond prices surged in heavy trading even as shares slipped, a divergence that some analysts said reflects uncertainty about how much new equity the bankrupt California utility needs to raise in order to address claims tied to past and future wildfires.
--- PG&E shares and bonds rallied last week after it reached its first major settlement with wildfire victims.
--- California Gov. Gavin Newsom proposed a plan for a multibillion-dollar fund to cover liabilities.
--- About $290m of PG&E bonds changed hands, making it the most actively traded high-yield corporate bond.
--- Its bond due 2034 hit 109.25 cents on the dollar, up from 107.5 Friday and 101.38 at the start of last week.
-- The company's stock fell 5.6% to $21.67.
Why This Matters
Ultimate recoveries on PG&E shares and bonds will depend on how the company raises capital to offset wildfire liabilities. Some of the funding could come from increasing charges to electricity ratepayers and from issuance of new bonds backed by the utility's future revenues. But the larger the size of the state wildfire fund -- options floated by Newsom range from $10.5bn to $21bn -- the more shareholders or bondholders will have to contribute themselves.
A fuller story is available on WSJ.com
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(END) Dow Jones Newswires
June 25, 2019 09:33 ET (13:33 GMT)
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