Energy Future’s Case Puts Spotlight on Prearranged Deals
Orange County partner Penelope Parmes was mentioned in an April 29 Law360 article titled “ Energy Future’s Case Puts Spotlight on Prearranged Deals.”The article isabout how private equity-owned utility Energy Future Holdings Corp.’s April 28 th Chapter 11 filing with a prenegotiated deal is what many experts are saying is the key to expediting bankruptcy procedures and reducing litigation costs from them. Energy Future Holdings, which listed liabilities of approximately $49.7 billion against more than $36.4 billion in assets in its Chapter 11 petition, struck prenegotiated plans with many of its financial stakeholders to reduce its debt.
“This case involves an enormous amount of debt,” said Penelope. “The most important thing is the lender group is in agreement with the debtors on the financing and exit strategy. What is clear is that this is going to be a case focused on cleaning up the balance sheet, converting debt to equity and getting rid of some subsidiaries to come out as a leaner, stronger company.”