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Energy Future steps up efforts to win support for restructuring deal

25 Oct 2013

fire flame burn heat energyPrivate equity-backed power generation company Energy Future Holdings has reportedly stepped up talks with bondholders, trying to win support for a restructuring deal before filing for bankruptcy.

The utility company is seeking support for a deal to restructure its $40bn debt pile proposed by its regulated holding company Energy Future Intermediate Holdings’s lenders, said Reuters, citing several people close to the talks.

Energy Future has stepped up efforts to convince first- and second-lien bondholders of its holding company to support the deal, said the sources.

KKR, TPG Capital and Goldman Sachs Capital Partners took the company private in the world’s biggest LBO deal in 2007, loading it with about $35bn of debt. Earlier this year lenders rejected a proposed $32bn debt restructuring plan for being too lenient on Energy Future’s owners.

Earlier this month Energy Future Intermediate revealed in a regulatory filing that some of its creditors had ended restructuring talks.

It was also reported that the company was close to securing a securing a loan of over $3bn ahead of a bankruptcy filing.

One of the company’s creditors has hired advisers to explore restructuring options before a $250m bond payment deadline on 1 November.

About 95 per cent of the consortium’s investment in TXU has been written off since the deal, while a regulatory filing last June showed the company’s debt to EBITDA ratio was 9.5 times.

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