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Energy Future gets approval for bankruptcy loan

9 Jun 2014

courtroomPrivate equity-backed utilities company Energy Future Holdings has secured approval for a $5.4bn bankruptcy loan.

Judge Christopher Sontchi has approved the loan and a settlement, which he said was fair, enabling the company to refinance its senior bonds. Investors holding less than half the nearly $4bn in senior bonds agreed to the settlement, said the Wall Street Journal.

The remaining 58 per cent of bondholders have taken legal action, seeking premiums of around $430m.

Energy Future, which was taken private KKR, TPG Capital and Goldman Sachs Capital Partners in the world’s biggest LBO deal in 2007, filed for bankruptcy in April this year.

The company said at that time that it had secured loans of $4.475bn and $7.3bn for its subsidiaries Texas Competitive Electric Holdings and Energy Future Intermediate Holding.

Last year the company’s lenders turned down a proposed $32bn debt restructuring plan for being too lenient on Energy Future’s owners.

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