Energy Future reaches deal to hand Oncor to creditors, but Hunt is still fighting
- Lawyers for Energy Future Holdings, the former TXU Corp currently in bankruptcy, announced Thursday that they have reached a deal to turn over Oncor Electric Delivery to a group of creditors, the Dallas Morning News reports.
- The agreement effectively halts a developing bidding war between NextEra Energy and Hunt Consolidated to control Texas' biggest T&D utility. The attorneys told a federal judge that it has agreements with a group of creditors representing $30 billion in debt, including financial firm Fidelity, which is reportedly leading the deal.
- Hunt has an offer on the table as well with a "core group" of supporters that own more than $4 billion in debt. The two proposals from Hunt and Fidelity must now compete for the favor of creditors.
The long and complex battle to acquire Oncor took an unexpected turn this week when attorneys for Energy Future Holdings announced a new agreement to turn the company over to a group of creditors led by investment firm Fidelity. Hunt is still vying for control of the prized Energy Future asset, valued at about $18 billion, and now creditors must decide which group they want to lead the company.
Energy Future filed for bankrupcy in 2014 and promised company employees that it would be out of court within a year. That deadline passed as the company struggled to find common ground with creditors for repayment on bonds that had dramatically dropped in value with the bankruptcy.
Earlier this month, it appeared that a bidding war was developing between Hunt and Florida-based NextEra Energy, one of the nation's leading renewables developers and owner of utility Florida Power & Light. Energy Future seemed poised to name NextEra the leading bidder, or "stalking horse," to help set the value of the company for auction.
That bidding, however, now looks like it will never happen. A federal bankrupcy judge cancelled a scheduled auction for the company and set a trial date in January 2016 to conclude the bankruptcy case for the company. NextEra officials were not present in court on Thursday and would not confirm if they are still seeking to buy the company.
Energy Future officials cautioned that there's still much to do before that date to ensure the company meets its fiduciary duties to shareholders.
“There’s a lot of work left, but getting this on the calendar we have a schedule to live by,” Marc Kieselstein, one of the company's lawyers, told the Dallas Morning News.
- The Dallas Morning News Energy Future plans to hand Oncor to creditors, Hunts fighting for control
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